UK Court of Appeal grants AstraZeneca an interim injunction against Glenmark’s generic dapagliflozin for type II diabetes

Chapter 1 PI refused by the lower court – damages an adequate remedy for AZ

The same interim injunction was refused on 28 March by Michael Tappin KC sitting as a deputy judge (who also heard the trial on the validity of the SPCs and underlying patent on 10-20 March).

The injunction sought was until the form of order hearing i.e. the hearing to determine the order after judgment on the validity of the SPCs and patent.

The basis for the Judge’s refusal was that AZ’s damages (if the injunction was wrongly refused) could be calculated with reasonable accuracy. By contrast, assessing Glenmark’s damages (and the NHS’ damages) under the cross-undertaking (if the injunction was wrongly granted) would be significantly more difficult (whether other generics entered the market or not) due to the likelihood of Glenmark losing first mover advantage and the unknown level of competition from other generics.

The NHS intervened. It argued that it would be in a weaker position than Glenmark when enforcing its claim on a cross-undertaking due to the lack of first-hand knowledge and access to relevant facts, a problem that would be exacerbated yet further if AZ settled with Glenmark.

As to the balance of convenience, the Judge found that (on the issue of clearing the way) Glenmark had asked for (but failed to get) a January 2025 trial back in January 2024. In the Judge's view, the fact that Glenmark was ready to launch shortly before the Court had managed to produce a judgment on the validity trial was not a significant factor.

The Judge found Glenmark should undertake to pay security into a separate bank account in respect of AZ’s potential future damage.

Chapter 2 Permission to appeal granted

On 31 March, Lord Justice Arnold granted AZ permission to appeal on three grounds.

The first ground was in two parts and was (paraphrasing): a failure to take into account the relevant uncertainty when assessing whether damages would be an adequate remedy for AZ; and inappropriate application of American Cyanamid including on adequacy of damages and the balance of convenience.

The second ground concerned a failure to properly take account of AZ’s loss after the form of order hearing (what would happen if the market became fully genericized by the time of that hearing?).

The third ground was that the Judge had erred in his assessment of the adequacy of damages to Glenmark.

Holding the ring, the Judge granted AZ an injunction pending the decision of the Court of Appeal. Glenmark was allowed to supply to its wholesalers the packs of dapa it already had ready for distribution, but not allowed to release those packs for onward sale in the UK.

Chapter 3 PI awarded - the lower court overturned

The appeal was heard on an expedited basis before Lord Justice Arnold, Lord Justice Coulson and Lord Justice Warby on 9 April.

In addition to the three grounds referred to above, their Lord Justices heard submissions on a new fourth ground of appeal, in support of which AZ was permitted (by agreement) to adduce fresh evidence not available to the lower court. This new evidence pertained to developments in the position of Teva and another generic (referred to in court as Generic X), the consequence of which (as argued by AZ) was (inter alia) that Glenmark no longer benefitted from a first mover advantage.

Glenmark submitted that nothing about AZ’s arguments moved the needle on the Judge’s price strategy finding (which was that AZ would not reduce its list or actual price upon generic entry). Glenmark argued this finding was central to why damages would be an adequate remedy for AZ (whether multiple generics entered the market or not) and was, in effect, a complete answer to AZ’s appeal.

After a short break, their Lord Justices delivered their decision: Glenmark’s dapa product is injuncted in the UK, with immediate effect, until the form of order hearing in the validity action.

The parties were ordered to agree the form of order on the injunction overnight (to ensure maintenance of the status quo).

The duration of the injunction is uncertain, tied as it is to the timing of the form of order hearing in the validity action. At the time of going to press, judgment in the validity action is still pending. However, at both hearings, the parties proceeded on the basis a form of order hearing would take place within 1-3 months of the first instance trial i.e. by no later than mid-June. Michael Tappin KC did not contradict this assumption in his PI judgment.

Recordings of the appeal can be accessed here and here.