Novartis Pharma AG v Eli Lilly Nederlands BV & Ors (Approved)

Factual and Procedural Background

This dispute arises between two multinational pharmaceutical companies, Plaintiff and Defendant, concerning European Patent (IE) 2 784 084 (the "Patent") entitled "Antagonist antibodies to IL-17A/F heterologous polypeptides," owned by Plaintiff. The Patent relates to antibodies that antagonise a protein implicated in immunity-related diseases such as psoriasis.

Defendant initiated a revocation action on 13 April 2021, challenging the validity of the Patent on grounds including lack of novelty, obviousness, and insufficiency. Plaintiff subsequently commenced infringement proceedings on 15 April 2021, alleging that Defendant's product infringes the Patent.

Defendant defends the infringement claim by asserting the Patent's invalidity, denying that its product falls within the Patent claims, and alleging that Plaintiff's conduct constitutes an abuse of a dominant market position in breach of competition law. Defendant also seeks to resist injunctive relief on the basis of hardship to patients relying on its product.

The Patent was originally filed by a third party on 2 June 2004 with a priority date of 8 July 2003. Plaintiff acquired the Patent on 25 September 2020 following an agreement dated 23 April 2020. Prior to this acquisition, the parent patent to the Patent was successfully challenged at the European Patent Office. Plaintiff had also previously initiated challenges to the parent patent in 2014 and 2019.

Both parties have sought multiple categories of discovery in both the revocation and infringement proceedings, with some overlap in the types of documents requested. The Court is tasked with applying discovery principles in the highly technical context of patent litigation to determine the scope and limits of discovery.

Legal Issues Presented

1. Whether the categories of documents sought by Defendant in the revocation action are relevant, necessary, and proportionate for discovery, including the appropriate temporal scope.
2. Whether the categories of documents sought by Plaintiff in the revocation action comply with the requirement for precise categories and do not infringe litigation privilege.
3. Whether the product description provided by Defendant suffices as discovery in the infringement action, negating the need for broader discovery.
4. Whether certain categories of discovery sought by Plaintiff in the infringement action are relevant and proportionate, including the scope of market and competition-related documents.
5. The applicability of litigation privilege to documents created after a specific date marking the commencement of litigation-related activities.

Arguments of the Parties

Defendant's Arguments

• The Patent lacks novelty, is obvious, and insufficient, and thus should be revoked.
• The scope of the Patent as asserted by Plaintiff improperly extends beyond antagonism to IL-17A/F to include antibodies binding to other proteins.
• The discovery sought by Plaintiff in the revocation action is overly broad and not sufficiently precise, breaching procedural rules.
• Discovery sought from Defendant in the infringement action should be limited, as Defendant has provided a product description sufficient for establishing infringement.
• Documents generated after 12 February 2017 are likely subject to litigation privilege and should not be discoverable.
• The temporal scope of discovery should extend beyond the usual four-year window due to Plaintiff's late acquisition of the Patent and the long factual background.
• Discovery obtained from a US court order restricts the use of those documents, necessitating further discovery in this jurisdiction.
• Market definition and competition-related discovery should exclude pipeline products and focus on actual market conditions.

Plaintiff's Arguments

• The usual four-year discovery window (two years before and after the priority date) is appropriate and standard in patent litigation.
• Documents in Defendant's possession relating to the Patent's validity and infringement are more significant than those in Defendant's possession, who never owned the Patent.
• Discovery categories sought are relevant and necessary, particularly those relating to antibody binding and biological activity.
• Documents created after 12 February 2017 are likely protected by litigation privilege and need not be disclosed.
• The product description provided by Defendant suffices for discovery purposes, negating the need for broader document production in certain categories.
• Discovery of internal arrangements related to marketing authorisation is irrelevant as such holding does not constitute prohibited acts under patent law.
• Market and competition-related discovery must include relevant pricing, sales, and switching data to properly address claims of abuse of dominance.
• Confidentiality concerns may justify postponement of certain discovery but do not justify refusal.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court acknowledged the highly technical nature of patent litigation and the primacy of expert evidence in resolving validity and infringement issues. It emphasized that discovery must be relevant, necessary, and proportionate to the fair disposal of the case, recognizing the burden and expense of extensive discovery.

Regarding the temporal scope of discovery sought by Defendant in the revocation action, the Court rejected the proposal for a circa 20-year period, favoring the standard four-year window (two years before and after the priority date). The Court found that Plaintiff's contractual rights to obtain documents from the original Patent owner during the four-year period mitigated the need for extended discovery.

The Court accepted Defendant's concern that discovery obtained under a US court order was subject to restrictive conditions limiting its utility, justifying additional discovery in this jurisdiction.

For specific categories relating to a 2021 publication, the Court ordered discovery of relevant backup documentation for a three-year period preceding publication, as this was narrowly defined and central to Defendant's invalidity claim.

The Court held that documents created after 12 February 2017 were likely generated in contemplation of litigation and thus subject to privilege, making their discovery unnecessary and disproportionate.

In the infringement action, the Court found Defendant's product description sufficient to satisfy discovery requirements for certain categories, obviating the need for broader document production. However, it ordered discovery for other categories, including internal arrangements and market-related documents, subject to postponement or confidentiality safeguards where appropriate.

The Court rejected discovery requests related to marketing authorization arrangements as irrelevant under patent infringement law.

On competition law-related discovery, the Court limited the scope to actual market conditions, excluding pipeline products, and accepted the need for comprehensive data including pricing, sales, and patient switching to assess alleged abuse of dominance.

The Court emphasized the importance of proportionality, endorsing a focused approach to discovery that avoids unnecessary expense and delays, consistent with appellate guidance discouraging pursuit of the 'perfect truth' over practical justice.

Holding and Implications

The Court's final decision is to ORDER discovery in accordance with the detailed rulings set out in its judgment.

Specifically, the Court:

• Granted Defendant discovery of six categories in the revocation action, with a four-year temporal limit, except for the narrowly defined category related to a 2021 publication, which was limited to three years prior to publication.
• Refused discovery of documents created after 12 February 2017 in the revocation action due to litigation privilege.
• Granted Plaintiff discovery in the revocation action but limited to documents upon which Defendant intends to rely, to ensure precision and proportionality.
• Accepted Defendant's product description as sufficient discovery in the infringement action for certain categories, refusing broader discovery in those categories.
• Ordered discovery of other categories in the infringement action, including internal arrangements and market-related documents, with some discovery postponed or subject to confidentiality.
• Rejected discovery related to marketing authorisation holding as irrelevant to infringement claims.
• Modified certain market-related discovery categories to exclude pipeline products and to focus on actual market dominance claims.

The Court encouraged the parties to cooperate to resolve outstanding discovery matters without further court involvement, acknowledging the evolving nature of the categories during the hearing.

No new legal precedent was established; rather, the decision applies existing principles of discovery, privilege, and proportionality to the complex factual matrix of this patent dispute.