Japan’s IP High Court Orders Generic Drugmakers to Pay JPY 21.7 Billion in Damages

In a patent infringement lawsuit filed by Toray Industries against two generic drug manufacturers — Sawai Pharmaceutical and Fuso Pharmaceutical — regarding a use patent for an anti-itch medication, the Intellectual Property High Court of Japan on May 27 ordered the two companies to pay a total of JPY 21.7 billion (approx. $140 million) in damages (Case No. Reiwa 3 (Ne) 10037).

This ruling marks a record-breaking damages award in Japanese intellectual property litigation, far exceeding the previous highest amount of around JPY 8 billion.

Patent Details

• Product: Remitch® OD Tablets
• Patent: Use patent (Patent No. 3531170), with extended registration (Application Nos. 2017-700154 and 2017-700310)
• Patent Expiry: November 2022 (after a 5-year extension)

Toray applied for a five-year extension of the use patent in 2017, the year the original 20-year term expired. However, in June 2018, 11 generic versions of Remitch were launched by 10 companies. Among them, the OD tablet versions were sold by Sawai and Fuso, prompting Toray to file a patent infringement lawsuit against the two companies later that year.

Legal Dispute
The main issues in the lawsuit were the scope of protection of the extended use patent and whether patent infringement had occurred.
Toray argued that even though the generic drugs used different excipients from the original drug, they still produced the same anti-itch effect, and therefore infringed the patent.
On the other hand, the two defendant companies contended that the scope of protection of the extended use patent had been narrowed, and that the generics, which contained different ingredients, could not be considered substantially the same formulation as the original.

Significance
The ruling is widely seen as a justified protection of the rights of originator pharmaceutical companies, which invest heavily in the development of new drugs.