China’s Supreme People’s Court upheld two lower court rulings in favor of the Nanjing Intellectual Property Administration of Jiangsu province in two separate complaints lodged by Chinese generic manufacturer Nanjing Hencer Pharmaceutical Co., Ltd. (南京恒生制药有限公司) and its wholly-owned subsidiary Nanjing Lifenergy R&D Co., Ltd. (南京生命能科技开发有限公司) respectively, alleging that the government agency erred in its findings of the two companies’ infringement of German multinational pharmaceutical and life sciences company Bayer AG’s patent.

Bayer AG filed an application for Chinese Patent No. 00818966.8 covering substituted oxazolidinones and their use in the field of blood coagulation in 2000, which was granted in 2006 and expired in 2020. The patent was embodied in Bayer AG’s drug Rivaroxaban (Chinese: 利伐沙班), sold under the brand name Xarelto (Chinese: 拜瑞妥) among others, an anticoagulant medication (blood thinner) used to treat and prevent blood clots. Specifically, it is used to treat deep vein thrombosis and pulmonary emboli and prevent blood clots in atrial fibrillation and following hip or knee surgery. Rivaroxaban was approved for medical use in China in 2009 and registered global sales of $7.498 billion in 2020.

Bayer Intellectual Property GmbH, Bayer AG’s intellectual property unit, in November 2019 filed a petition for a declaration of patent infringement against Hener and Lifenergy in the Nanjing Intellectual Property Administration accusing the two companies of infringing Chinese Patent No. 00818966.8 by advertising and offering for sale Rivaroxaban and its active pharmaceutical ingredients (APIs) expressly indicated to be manufactured by Hencer on their websites. In the complaint, Bayer IP cited the fact that Lifenergy presented Hencer as the manufacturer of Rivaroxaban and its active pharmaceutical ingredients on display boards in its booth at two editions of the CPhI China held in 2018 and 2019. The CPhI, standing for Convention of Pharmaceutical Ingredients, was an exhibition of pharmaceutical ingredients and intermediates held for close to 20 editions around the world from Japan, China, India, to Russia and South America.

The complaint also said the details concerning Rivaroxaban available on the two companies’ websites and exhibition boards, including its generic name, brand name, structural formula, and CAS Registry Number, a unique numerical identifier assigned by the Chemical Abstracts Service (CAS), U.S. to every chemical substance described in the open scientific literature, were found to be the same as Rivaroxaban patented by Bayer IP. The petitioner specified that the generic version of Rivaroxaban on offer by Hencer and Lifenergy infringed at least claims 1, 2, and 6 of the asserted patent.

The Nanjing IP authority in May 2020 had an oral hearing of the complaint, where Hencer and Lifenergy argued that they didn’t offer Rivaroxaban for sale since they had not been granted registration of Rivaroxaban with the Jiangsu Food and Drug Administration and the Drug Manufacturing License secured by them alone didn’t entitle them to manufacture and distribute Rivaroxaban. Hencer and Lifenergy also argued that their presentation of Rivaoxaban was one of the exceptions and limitations to patent rights under Article 6 of the third amendments to the Patent Law of the People’s Republic of China effective in 2009.

The government agency rebuffed the two respondents’ arguments, holding that their presentation was not meant to inform specific examiners for administrative review as claimed under Article 69 Paragraph 5 but part of their toutings for business extensively targeting general consumers and other drug manufacturers. The agency found the two respondents infringed Bayer IP’s patent and ordered them to delete all the information about Rivaroxaban in their presentations in any shape or form.

Hencer and Lifenergy appealed the case to the Nanjing Intermediate People’s Court of Jiangsu province, which in turn upheld the agency’s decision in February 2021. The Supreme People’s Court on June 22 affirmed the lower court’s rulings.

The case docket nos. are （2021）最高法知行终451号 and （2021）最高法知行终702号, whose English translations are 451, second instance (终), administrative case (行), (2021) Supreme People’s Court and 702, second instance (终), administrative case (行), (2021) Supreme People’s Court.

中文新闻线索：

https://mp.weixin.qq.com/s/8OMnhjiM9hsOCO7H-hl2Cg

https://mp.weixin.qq.com/s/BOi3mNj8s2t65qWsh7v6FA

http://www.xuandpartners.com/cn/laws/31?page=7

http://www.iprchn.com/cipnews/news_content.aspx?newsId=123516

https://www.otsukac.co.jp/en/exhibition/2013/cphi-ww.html#:~:text=CPHI%20(Convention%20of%20Pharmaceutical%20Ingredients,to%20Russia%20and%20South%20America.

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