Patent Infringement Actions

Generally, only patent proprietors and exclusive licensees have standing to sue for patent infringement. Nevertheless, others may also be granted the authority to assert certain claims under specific conditions and limitations.

Patent Proprietors

A patent proprietor, including a co-owner, has standing to sue for patent infringement. In this regard, depending on the particular claim of relief being requested, it is the formal registration as proprietor which is decisive, rather than the substantive ownership:

• the claims of relief of cease-and-desist, recall and destruction of infringing products may only be asserted by the person registered as proprietor in the register of the German Patent and Trademark Office (GPTO); and
• for the claims of damages and rendering of accounts, the person(s) registered in the GPTO patent register as proprietor is presumed to have been the proprietor(s) over the time of their registration, but the defendant may challenge this; if the challenge is successful, the plaintiff must request the rendering of accounts on behalf of the actual owners and the damages to be paid to them.

Co-owners may generally request a cease-and-desist order and the recall and destruction of infringing products on their own, ie, without the involvement of the other co-owner(s), unless otherwise stated in their agreement. With respect to damages, a co-owner must request the rendering of accounts and payment to all co-owners.

Exclusive licensees

An exclusive licensee also has standing to sue with respect to all available claims of relief, provided the infringing product and activity are within the scope of the licence.

It is not necessary to register the licence with the GPTO.

Others

Persons other than proprietors and exclusive licensees do not have standing to sue, but may be empowered by a proprietor or exclusive licensee to assert certain claims.

Claims for damages and unjust enrichment are generally assignable and may, therefore, be asserted by an assignee.

Third parties with their own interest in stopping the infringer may seek injunctive relief and the recall and destruction of infringing products if the patent proprietor or exclusive licensee has authorised them to assert these claims on their behalf (Prozessstandschaft). Non-exclusive licensees typically have such an interest if the infringing activities affect their sales.

Joinders

In an infringement action brought by an exclusive licensee, the involvement of the patent proprietor(s) is generally unnecessary, as the infringement court cannot invalidate a patent.

There may, however, be other reasons for joining a third party in the litigation, and the German Code of Civil Procedure (GCCP) allows for such joinders.

Nullity Actions and Oppositions

In nullity proceedings, anyone has standing to sue, at least for as long as the patent is in force. If the patent has expired or lapsed, the plaintiff must demonstrate a legal interest in the action.

The same applies to opposition proceedings before the European Patent Office (EPO) and the GPTO. However, the latter has little practical relevance in the field of life sciences. It is very rare, at least so far, to file a German national patent application for life science inventions.

Depending on the future experience with the Unified Patent Court (UPC), applicants may, however, wish to retain the possibility to litigate life science patents nationally by filing (also) nationally after the option to opt-out of newly filed European patent applications from the competence of the UPC has expired (probably in 2030). A further, albeit more limited approach is the branching-off of German utility models from pending European patent applications. It is confirmed that utility models can protect medical use inventions. However, the maximum lifetime of a utility model is ten years, counted from the application date of the European patent if the utility model is branched off.

German courts cast a wide net when it comes to patent infringers. Anyone who facilitates infringing activities in Germany, such as manufacturing, offering, or placing the infringing product on the market, can be considered an infringer.

In the life sciences field, defendants are primarily the manufacturers or importers who hold the marketing authorisation. Wholesalers and others may be addressed in warning letters, but are rarely joined as defendants.

A particularly interesting position in the German pharmaceutical market is held by IFA GmbH, an information service provider for the pharmaceutical market. Specifically, it maintains a database of all pharmaceuticals distributed through German pharmacies. The database, updated twice a month, is the basis (indirectly via providers of specialised software for pharmacies and other users) for all pharmacies’ transactions with their customers and the pharmaceutical wholesalers who supply them. IFA is, therefore, a gatekeeper in the German pharmaceutical market. It regularly finds itself under pressure from (generic) manufacturers on the one hand and patent proprietors on the other, including as a defendant in provisional injunction proceedings.

Although main infringement proceedings in Germany are relatively fast by international standards (see below), provisional injunctions play an important role in life sciences litigation, especially in the case of a generic launch in the presence of pertinent patents (launch at risk). The reason for this is the immediate and irreversible impact of generic competition on originator prices in Germany and other countries that reference the German price.

The provisional measures that may be requested include a cease-and-desist order and the seizure of infringing products.

Requirements for a Provisional Injunction

To obtain a provisional injunction, the petitioner must make it credible to the court that the patent is being infringed and that it would be unreasonable for the petitioner to be deferred to the main proceedings. The latter is a comprehensive assessment including the patent’s validity, urgency, and the parties’ respective interests.

Infringement

In practice, there are no particular differences between a provisional injunction and the main proceedings with respect to infringement. The court must be convinced that the patent has been infringed or that the infringement is imminent. The experienced patent panels, especially in Düsseldorf and Munich, are accustomed to handling even technically complex cases if adequately supported by the explanations in the petitioner’s written submissions.

Validity

The standard for determining patent validity has been a topic of significant debate in recent years. Generally, most courts require that the validity be confirmed beyond just the initial grant of the patent. This confirmation may stem from the fact that the patent has withstood inter partes proceedings, such as an opposition, or has faced challenges from third-party observations during prosecution. However, there have always been exceptions to this rule, especially in the context of early generic market entry. A panel of the Regional Court (Landgericht) Munich sought to challenge the prevailing practice by referring questions for a preliminary ruling to the Court of Justice of the European Union (CJEU). The CJEU ruled that a practice of rejecting provisional injunction requests when the patent’s validity has not been confirmed in inter partes proceedings is contrary to EU law (judgment of April 28, 2022, C-44/21). The CJEU has held, inter alia, that European patents enjoy a presumption of validity upon grant. This judgment did little to resolve the differences. The Munich Regional Court sees it as confirmation of its more liberal approach. Other judges criticise that their practice was misrepresented to the CJEU, resulting in a decision that did not address the actual practice.

Urgency

After becoming aware of the infringement and the infringer, the petitioner must promptly file their request for a provisional injunction without undue delay. A period of about four weeks is not considered an undue delay, but any significantly longer period requires a reasonable justification, such as the need for experiments, which must also be conducted expeditiously.

A favourable decision in inter partes validity proceedings, eg, by the Opposition Division, can start a new urgency clock.

Procedure

Requesting a provisional injunction to be granted ex parte

The petitioner may request that the provisional injunction be granted ex parte, ie, without hearing the respondent, but must justify exceptional time pressure.

The court must consider this request in light of the respondent’s constitutional right to procedural equality of arms. In principle, the respondent must be heard, but there are exceptions. Exceptions include cases of exceptional urgency or if the petitioner has sent a warning letter.

An ex parte injunction is often issued within one to two working days.

The court may also hear the respondent in writing before issuing a cease-and-desist order, which may take about two weeks.

Enforcing an ex parte injunction

The petitioner must execute the provisional injunction by serving it on the respondent.

The court may make the execution conditional on the applicant providing security to respondent for their claim in the event that the provisional injunction is later lifted, compensating respondent for any harm incurred as a result of the enforcement of the provisional injunction. Such security is usually provided in the form of a bank guarantee from a German bank.

If the provisional injunction is not executed in the manner described above within one month of its issuance, the respondent may request that it be lifted on this ground alone. It will typically not be possible to apply for a new provisional injunction because of the lack of urgency.

Protective briefs

A protective brief is a common instrument to ensure that one is heard before the court considers an ex parte injunction. A protective brief is an anticipatory defence brief filed when one is concerned about an ex parte injunction, eg, before launching a product or attending a trade fair or conference in Germany. The brief is filed with an online repository accessible only to the German courts.

Should a provisional injunction request be filed, the court would search the repository for a protective brief and decide how to proceed. A provisional injunction is still possible, namely when the protective brief fails to convince. If the court decides not to issue the provisional injunction, it may contact the petitioner and recommend that they withdraw their request. If this is not done or the petitioner refuses, the court will proceed to inter partes proceedings.

The protective briefs are valid for six months but can be renewed.

Objection by the respondent against an injunction order

If a respondent is faced with an ex parte injunction, they can – at any time – file an objection with the court, which will cause the court to schedule a hearing, as set out below.

Oral hearing in provisional injunction proceedings

If the provisional injunction is not requested ex parte or if the court does not grant it, the court will serve the provisional injunction request on the respondent and schedule an oral hearing, typically held about two to three months later.

The same applies if the respondent objects to a provisional injunction order.

Parties may submit arguments until the oral hearing concludes, with no preclusion rules applied. The opposing party must respond immediately to any new submissions. The court will only exclude an assertion if it determines that a party deliberately withheld it to ambush the opposing party. Given this procedural flexibility, parties must prepare comprehensively for all possible scenarios and ensure that potential witnesses and party experts attend the hearing.

Upon the hearing, the court issues a judgment. This judgment can be appealed. It is also merely provisional – the defendant can, at any time, request that the provisional injunction be lifted due to changed circumstances.

Relation to main proceedings

Provisional injunction proceedings are independent of the main action in Germany. Respondents can request the court to set a deadline for commencing a main action, which is rarely used.

Patent infringement proceedings in Germany are bifurcated. The infringement courts are not permitted to hold that a patent is invalid.

Parallel invalidity proceedings must therefore be pending to argue a patent’s invalidity in an infringement action. Either the defendant or a third party may initiate such proceedings, which can be an opposition before the EPO or GPTO, or a nullity action before the Federal Patent Court (Bundespatentgericht). Opposition must be filed within nine months of the grant. Once this nine-month opposition period expires and no opposition is pending, a nullity action becomes admissible.

In the infringement proceedings, upon the main oral hearing, if:

• the requirement of parallel invalidity proceedings is met; and
• the infringement court should conclude that the patent is infringed, then

the court may, in its discretion, order a stay of the infringement proceedings pending a decision in the parallel invalidity proceedings. In exercising this discretion, the court must balance the interest in non-contradictory decisions with the plaintiff’s interest in a timely decision on infringement. Defendants should, therefore, not wait too long before commencing a nullity action.

First-Instance Infringement Actions

An infringement action can be commenced at any time. As long as infringing activities are ongoing, the cease-and-desist claim will not be statute-barred. The claim can be considered waived, but only if the right holder takes steps that can be construed as a waiver. Claims for past damages and unjustified enrichment can be barred by the statute of limitations, even if the infringements are ongoing.

To initiate an infringement action, the plaintiff must file a complaint with any regional court (Landgericht) with competence in patent matters and pay the court fee. German proceedings are front-loaded, so the complaint must substantiate the infringement and offer evidence.

The court will serve the complaint on the defendant. If service is outside the EU, it is served pursuant to the Hague Service Convention.

Under the service, the court sets two deadlines for the defendant: the first for an attorney-at-law to assume representation, and the second for the submission of the statement of defence.

After the initial exchange of complaint and statement of defence, the parties are free to exchange further briefs; one or two more rounds of briefs are typical.

The presiding judge can exercise more or less control over this stage of the proceedings, eg, by:

• setting time limits for further briefs;
• scheduling an early court hearing; or
• written guidance orders.

In patent infringement proceedings, all of those are rather uncommon as of late.

Eventually, the court will schedule the main hearing, usually about nine to 12 months after service.

While the burden of proof for infringement is initially on the plaintiff, if the plaintiff sufficiently substantiates their case, the defendant must dispute it at a matching level of substantiation. In this regard, the parties are prohibited from lying or misleading. It is, therefore, usually not sufficient for the defendant to merely dispute that the contested embodiment is construed or operates according to the claim; the defendant must specify the allegedly non-infringing construction or operations. In this way, German courts largely manage without the need for investigation or evidence tracking. A legal instrument to request disclosure of a specific document under certain conditions is available but rarely used. Discovery or document disclosure is not available.

If the court deems it necessary, it can call witnesses proposed by a party to be present at the hearing for questioning, predominantly by the court. This is, however, also rare in patent infringement proceedings.

To prepare for the hearing, the reporting judge writes a preliminary opinion based on the written submissions. This opinion is then discussed internally with the presiding judge and the third judge, resulting in the court’s preliminary opinion. At the outset of the hearing, the presiding judge presents this preliminary opinion to the parties involved. The attorneys then have an opportunity to respond to the court’s preliminary opinion. The entire hearing typically lasts about two to three hours.

Upon the hearing, unless the court finds that its decision hinges on a factual issue for which evidence must be taken, the court will typically issue a judgment within four to six weeks. If the decision favours the plaintiff, the plaintiff can provisionally enforce the judgment upon providing security.

First-Instance Nullity Actions

As with infringement actions, the plaintiff initiates the action by filing a complaint with the Federal Patent Court (Bundespatentgericht) and paying the court fee. The complaint must set out all validity attacks in sufficient detail for the court to decide on this basis alone, should the defendant not dispute it.

A nullity action can be served on either the proprietor or the representative, as recorded in the GPTO patent register.

With service, the court will set the defendant a one-month deadline to declare whether they intend to object to the request for invalidation, and a further month (extendable to two months if sufficient grounds are given) to substantiate the grounds for the objection.

Within six months of service, the court shall issue a preliminary opinion.

The parties can exchange further briefs, and the court can set further deadlines to guide this process.

The main hearing is typically scheduled about 18 to 24 months after service, and a judgment is issued, usually about two months later.

The nullity action is usually a reaction to being served an infringement action. Given the one-to-two-month preparation period required and the longer overall duration of nullity proceedings compared to infringement proceedings, infringement courts typically rule on both infringement and potential stays before nullity courts conduct their hearings. The above-mentioned (early) preliminary opinion has been introduced to assist the infringement court in deciding whether to stay.

While an infringement action can be filed before a patent grant, a cease-and-desist order (in main or provisional injunction proceedings) requires that the mention of the grant has been published.

If a patent applicant wishes to stop infringements before the grant, an option may be to branch off a utility model from the pending application. A cease-and-desist order can be based on such a utility model after a few days or weeks, as only registration is required. Utility models are available for product claims, including medical use claims, and have a term of ten years (if branched off from a patent application, calculated from the filing date of the patent application they have branched off from).

The plaintiff bears the burden of proof regarding the infringement, which can be challenging if the patent regards a manufacturing process. The German Patent Act (GPA), however, reverses the burden of proof if the patented manufacturing process creates a new product.

Under German law, there is no pre-action discovery or disclosure.

Inspection orders are available under Section 140c GPA. While the requirements in the books have been mostly aligned with procedures known in other European jurisdictions following the implementation of the EU Enforcement Directive 2004/48, inspection proceedings in Germany still have their own procedural particularities.

To obtain an inspection order, (i) the patentee or an authorised person is required to demonstrate that (ii) infringement is sufficiently likely, ie, that there are concrete indications for infringing acts by the defendant or another person, whereas (iii) the inspection into specific objects or documents assumed with the defendant (iv) is necessary for the applicant for establishing its claims. The court will then assess the proportionality of issuing such an order. In essence, an inspection order is most likely to be granted if the applicant has collected all pieces necessary to establish infringement, except for certain facts that are otherwise inaccessible to the applicant. Inspections can be sought in provisional proceedings (Section 140c(3) GPA) and granted ex parte, provided there is a sufficient reason (eg, concerns that the purpose of the inspection may be frustrated if the defendant had advance knowledge of the request) and, according to some courts, urgent action of the applicant.

In order to ensure the confidentiality of the results while also fulfilling the proportionality requirement and permitting use of the obtained evidence in main proceedings, inspection requests are frequently combined with an evidence preservation procedure, as detailed in Section 485 of the Code of Civil Procedure. Under this process, known as the Düsseldorf procedure (Düsseldorfer Verfahren), a court-appointed expert conducts the inspection in accordance with tasks specified by the court. The applicant’s outside counsel accompanies the expert and is bound by a strict confidentiality order.

The process concludes with the expert providing a written report, after which the court will decide whether to release an unredacted version, having considered the parties’ arguments. This final stage is generally completed within six months of the initial application.

Per Section 493 Code of Civil Procedure, the expert report may be utilised in subsequent infringement or unrelated proceedings (Section 411a Code of Civil Procedure).

Under German law, declaratory actions require the plaintiff to demonstrate a specific legal interest in the declaration being sought for the action to be admissible. Requests for declarations of non-infringement thus typically depend on a particular behaviour exhibited by the defendant, such as claiming entitlement to certain rights in a warning letter. A negative declaratory action does not bar a main infringement action, nor does it determine the forum for such action.

“Arrow declarations”, ie, requests for a declaration stating that a specific embodiment is either not novel or obvious in light of certain prior art (and thus cannot fall under the scope of protection of a patent granted later), have so far not been granted by a German court.

In contrast, infringement actions typically contain merely a declaratory request that the defendant is obliged to reimburse the plaintiff for any damage suffered from the infringement. As a result, German patent litigation typically consists of two phases: the first focuses on the infringement itself, while in the second phase, the amount of damages may be subject to a separate action (see 5.4 Damages).

The claims of a patent – in light of the description and drawings – define the patent’s literal scope of protection, but due account shall be taken of any element equivalent to an element specified in the claim (Protocol on the Interpretation of Article 69 EPC). Based on the skilled person’s understanding of the claims, the court assesses whether modified means used in the contested embodiment are equally effective for solving the problem underlying the invention. This assessment is a three-staged test (FCJ, X ZR 168/00 – Schneidmesser I; X ZR 29/15 – Pemetrexed), as outlined below.

• Stage I: Does the contested embodiment solve the problem of the invention with features (the “Variant”) that are different from the claimed features, but which produce an identical effect in the context of the other features of the claim?
• Stage II: If so, would the common general knowledge of the priority date have enabled the skilled person to identify the Variant as having the same effect?
• Stage III: If so, there will have been considerations that were necessary for the skilled person to identify the Variant as having the same effect: Are these considerations guided by the teaching of the patent claim, ie, would the skilled person have looked upon the contested embodiment with its Variant as being equivalent to the claimed embodiment in view of the teaching of the patent as covered by the patent claim? Despite the Variant, the skilled person must consider the contested embodiment to be based on the patent claim and, in a broader sense, still represents an embodiment of the patent.

In striking a fair balance between the patentee’s interest in covering equivalent solutions and legal certainty, the third question is particularly important. Case law assesses each feature in the context of the description as a whole. A limitation of the claims to a particular example from the description may result in pledging alternatively disclosed embodiments to the public (FCJ, X ZR 16/09 – Okklusionsvorrichtung). Courts may turn to the patentee’s submissions in the grant proceeding to assess whether an amendment was indeed meant to limit the subject matter of the patent, ie, to distinguish the claimed invention from the prior art, or merely to overcome formal objections (FCJ, X ZR 29/15 – Pemetrexed).

A court must not find equivalent infringement if the claimed solution was not novel or inventive over the relevant prior art (so-called Formstein defence, FCJ, X ZR 28/85). The rationale for this defence is that the patent owner could not secure patent protection for an invention that was already in the public domain when the application was filed. It follows that these known solutions or embodiments cannot constitute a patent infringement.

Under German law and practice, there is no obligation to clear the way before launching a product, and failing to do so is not a factor considered by the court when deciding on whether to grant an injunction. However, a defendant must submit their validity challenge early – well before the oral hearing date – if they want the infringement court to consider the likelihood of the patent being invalidated in its decision on an injunction.

Expert evidence plays only a limited role in German proceedings, as courts prefer to decide a dispute based on the parties’ written submissions. Questions of claim interpretation and patent validity are considered legal questions for the court to decide.

In infringement proceedings, parties often rely on statements and reports of private experts to verify and support the credibility of their assertions. Such evidence, however, is accorded no procedural status beyond that of regular submissions by representatives, unless the parties’ experts are proposed and summoned as witnesses. Party experts are not subject to particular duties and obligations to the court. Intentionally false statements and misleading the court can have consequences under general criminal law rules.

Upon request of the parties or its own assessment, a court may appoint a neutral expert as formal evidence for answering any specific factual question it considers relevant for deciding the dispute (Section 402 et seqq. Code of Civil Procedure). Court-appointed experts are required to maintain impartiality and to respond to the specific question posed by the court. Selecting experts, preparing and discussing the expert report, and typically conducting further oral hearing considerably delay a decision on the dispute. In provisional proceedings, the court relies entirely on the parties’ submissions; court-appointed experts are not used.

German courts treat experimental evidence the same as other factual assertions. Parties may submit the results of experiments through written reports, including party expert reports. When the opposing party disputes experimental findings, the individuals who conducted the experiments may be summoned to provide witness testimony.

Further, court-appointed experts may be requested to conduct certain experiments to answer the questions referred to them.

As stated in 1.7 Pre-Action Discovery/Disclosure, there is no pre-action discovery or disclosure, and neither is there in the proceedings.

It is the plaintiff’s burden to substantiate and offer evidence for the facts underlying its legal claim. On the other hand, a party may utilise information from a variety of sources. In principle, even illegally obtained information may be used. Courts apply only limited exceptions, eg, if the manner in which the information was unlawfully obtained violated a person’s constitutionally protected fundamental rights. Moreover, the burden on the defendant to respond at a level of substantiation matching that of the claimant’s submission, and not to lie or mislead, compensates for the lack of pre-action discovery or disclosure.

The GCCP allows a party to request that the court compel the opposing party to produce a specific document essential to the requesting party. However, this process requires a high degree of specificity, often proving unhelpful in practice.

Patent infringement proceedings typically evolve along diverging views on the patent’s scope of protection. In addition, the defendant may rely on a number of defences, the most pertinent of which have been outlined below.

• Permitted uses: Section 11 GPA enumerates the permitted uses of a patent (eg, private action, acts of experimental use and Bolar exemption, see 2.3 Acceptable Pre-Launch Preparations and 3.3 Acceptable Pre-Launch Preparations).
• Private prior use right (Section 12 GPA): While a prior use right in principle is limited to the actual use, courts have come to accept scaling up and amending the concerned embodiment unless the intrusion into the scope of protection is intensified (FCJ, X ZR 95/18).
• Exhaustion: If the product in question has been put on the market within the EU or the EEA with the patentee’s consent, the patent protection in question shall be deemed to have lapsed for the concerned embodiment. As a transitional provision, EU law includes a specific mechanism for the parallel import of pharmaceuticals from later-acceding member states, taking into account the divergent levels of protection available at the time of application.
• Statute of limitations (ee 1.5 Timing for Main Proceedings on Infringement/Validity).
• Section 139(1)3 GPA, in theory, also allows the defendant to rely on third-party (patient) interests to argue that an injunction would have disproportionate effects, but plays little role in practice due to the very high bar.
• If the DoE is applicable, the Formstein defence may be invoked (see 1.10 Doctrine of Equivalents).
• Due to Germany’s bifurcated system, a defendant can only indirectly assert the invalidity of the patent concerned, namely by requesting a stay of the infringement proceedings in view of the success chances of a pending validity attack before the EPO or the federal courts (see 1.16 Stays and Relevance of Parallel Proceedings).

Stay Because of Parallel Invalidation Proceedings

As explained under 1.4 Structure of Main Proceedings on Infringement/Validity, the infringement court can stay the action in view of parallel invalidation proceedings regarding the patent in suit.

Stay Because of Parallel CJEU Proceedings

Courts may also stay infringement proceedings when proceedings are pending at the CJEU (for example, when a preliminary ruling has been requested), should the infringement court’s decision depend on the outcome of those CJEU proceedings.

Stay Because of Lis Pendens

If proceedings involving the same cause of action between the same parties have been brought before another EU court, the German court must stay its proceedings under Article 29 Brussels I Regulation ((Regulation EC) No 44/2001 (recast)) until the court seized first has determined whether it has jurisdiction. If the proceedings are merely related, the court that has been seized later has discretion to stay its proceedings (Article 30 Brussels Regulation I (recast)).

No Discretionary Stay – Taking Foreign Judgements Into Consideration

The court has no discretionary powers to stay the infringement proceedings, for example, to await a foreign decision in scenarios other than the one mentioned above. However, sometimes the court’s discretionary scheduling powers can appear to be used to await a certain event.

In principle, German courts must take into account a decision by a foreign court on another national part of the same European patent and, if the court reaches a different decision, explain why it diverges. Decisions from the USA or other overseas courts to the contrary are not considered persuasive, as their practices are seen as too different.

A patent can only be amended in opposition or nullity proceedings, not through infringement proceedings.

In infringement proceedings, however, a patent can be asserted in limited form by the plaintiff (eg, to reduce the risk of a stay). Plaintiffs may accomplish this initially through so-called “in particular” claims, in which they demonstrate that the contested embodiment also satisfies certain dependent claims or features from the description, while preserving their broadest cease-and-desist request without limitation. This allows the plaintiff to potentially limit the asserted claim later in the proceedings (ie, if the patent is upheld in such amended form).

The plaintiff may commence infringement proceedings or provisional injunction proceedings regarding a patent at any of the twelve regional courts with specialised patent panels, at least as long as infringing acts are conducted or imminent in the court’s territory. In practice, this gives the plaintiff freedom to forum-shop between these courts. As plaintiffs usually choose an experienced court, the Regional Courts Düsseldorf and Munich handle almost all infringement actions in the field of life sciences.

Under German law, different acts related to a generic market entry can constitute patent infringement, as outlined below.

• Offering or advertising at trade fairs despite patent protection.
• Listing in the Lauer-Taxe: This database contains all available drugs and other medicinal devices in Germany. It is also sufficient if there is a listing in another database, such as physicians’ software.
• Announcement of market entry: A serious and unambiguous specific announcement of intended market entry is generally sufficient for an imminent threat of infringement.
• Entering into a rebate agreement with a public health insurance company.

However, the acts outlined below do not constitute a patent infringement.

• Grant of a market authorisation as well as trials and studies in preparation thereof (see 2.3 Acceptable Pre-Launch Preparations).
• Application for reimbursement.
• With respect to second medical use patents: Skinny labelling (Article 11 Directive 2001/83/EC) – unless the plaintiff can establish that the defendant exploited an existing prescription practice in the protected use (HRC Düsseldorf, 2 U 27/18).

The originator is responsible for submitting data regarding the initial market entry. The data will be protected for a period of eight years from the date of submission of this application for MA. During this period, the generic company is not permitted to access these documents.

After the eight-year period, the originator is granted a two-year market exclusivity. This indicates that a generic company is permitted to apply for an MA and may be granted such a status, but must refrain from sales activity until the application is approved. The originator may request an extension of the market exclusivity period by one year if a new use is authorised within the first eight years and this new use provides significant clinical benefit.

In total, the periods are described as “8+2+1”.

An exception is made for orphan drugs. Orphan drugs are granted a period of ten years of market exclusivity, which can be further extended by two additional years.

The experimental use exemption under Section 11(2) GPA exempts any acts directed at gaining insights into the invention, including proof of function. Following the clinical trial decisions (FCJ, X ZR 99/92 and X ZR 68/94), such exempted experimental use may additionally be motivated by commercial interests.

The German legislator has also opted for a broad implementation of the Bolar exemption in Section 11(2b) GPO, extending the exemption to all studies and tests and the resulting practical requirements undertaken to obtain a marketing authorisation. The exemption is not limited to generics and also applies to acts undertaken for obtaining non-EU, eg, FDA approval. The position of the German courts is that third-party suppliers may also benefit from their customer’s exemption under the Bolar and experimental use exemptions, subject to strict requirements. A reform of the underlying EU legislation, which may lead to full harmonisation among EU member states, is under discussion.

The Federal Institute for Drugs and Medical Devices publishes a monthly updated anonymised list of pending applications for marketing authorisations; granted MAs are compiled and publicly accessible in the AMIce database. No notice or other information will be given to the MA holder.

Marketed pharmaceuticals are included in the Lauer-Taxe, which is updated twice a month and becomes effective a few days after publication.

MAs and reimbursements are granted without consideration of the patent status (no patent linkage system). The private company IFA is entrusted with issuing tag numbers for pharmaceuticals (PZN) and compiles data on commercialised pharmaceuticals (which is then published, eg, in the Lauer-Taxe). IFA thereby acts at least partly as a gatekeeper against generic launch (see Germany Trends and Developments for details).

Public health insurers may, in theory, resort to indication-specific tendering, because allowing generic bidding on unlimited tenders may constitute an act of infringement if use patents still cover certain indications.

There are no differences between biosimilars and generics in terms of infringement (see 2.1 Infringing Acts).

There are no differences between biosimilars and generics regarding data and regulatory exclusivity (see 2.2 Regulatory Data and Market Exclusivity).

The experimental use and Bolar exemptions under German law also cover biosimilars (see 2.3 Acceptable Pre-Launch Preparations).

There are no differences between biosimilars and generics in terms of publicly available drug and patent information (see 2.4 Publicly Available Drug and Patent Information).

There are no differences between biosimilars and generics regarding reimbursement and pricing/linkage markets (see 2.5 Reimbursement and Pricing/Linkage Markets).

In Germany, supplementary protection certificates (SPCs) are available for patents relating to active ingredients of medicinal products as well as plant protection products. The holder of a patent for a new medicinal product or plant protection product must refrain from placing it on the market until it has received the necessary authorisation. This reduces the period of effective protection of the patent. SPCs have been established to partially offset this loss of time to monetize the invention.

German SPCs for medicinal products are governed by Regulation (EC) No 469/2009, which has been translated into national law. Relevant provisions can be found in Sections 16a and 49a of the GPA.

Any active ingredient or combination of active ingredients protected by a patent and subject matter prior to being placed on the market as a (human or veterinary) medicinal product may be the subject matter of an SPC.

Article 3 of Regulation 469/2009 sets out the requirements for obtaining an SPC for a medicinal product. The product (ie, the active ingredient or combination of active ingredients of the approved medicinal product) must be “protected” by a basic patent in force (Article 3(a)). There is no limitation to certain types of patents; a suitable basic patent may protect the product, the process for obtaining the product, or the application of the product. However, to be “protected” by the basic patent, the product must be “specifically identifiable” in the patent based on the disclosure of the patent, the common general knowledge and the prior art. Furthermore, the product must have received a valid authorisation to be placed on the market as a medicinal product for human or veterinary use (Article 3(b)). Each patent holder may only obtain a single SPC for a particular product (Article 3(c)) on the basis of the first authorisation for placing the product on the market (Article 3(d)). In other words, the holder of several patents must select one patent from the patent portfolio as the basic patent of the SPC. Although a patent holder may file multiple SPC applications for the same product, the grant of one SPC precludes the issuance of any additional SPCs to that same patent holder for the same product.

SPC applications must be filed in the patent holder’s name. Frequently, the marketing authorisation holder and patent holder are separate entities – either as distinct legal entities within the same corporate group or through a licensing arrangement. The current proposal for an amended SPC Regulation contains a provision according to which the patent holder may not obtain an SPC without the MA holder’s consent.

If the originator (the MA holder) and a third party each hold separate patents (and provided that both firms are unrelated entities), SPCs may be granted to both parties.

The circumstances under which an SPC for a combination of active ingredients can be obtained after an SPC for a single product has already been granted based on the same patent were the subject of a recent decision of the Court of Justice of the European Union (CJEU) on joined cases C-119/22 and C-149/22. The CJEU ruled that an SPC may be granted if the combination of the two active ingredients necessarily falls within the scope of the same patent. Where a separate patent specifically protecting the combination of active ingredients exists, the grant of an SPC is generally also possible.

Regulation (EU) No 2019/933 amended Regulation (EC) No 469/2009 and introduced the so-called "manufacturing waiver" for SPCs. According to this waiver, companies based in the EU are exempt from the legal effects of the SPC if they manufacture a generic or biosimilar product:

• either solely for export to a country outside the EU (“third country”) where the product is not protected by a patent or patent term extension (PTE); or
• during the last six months of the SPC term for placing it on the market in the EU once the SPC has expired (“stockpiling”).

The SPC term may be extended by 6 months if clinical studies of an agreed paediatric investigation plan (PIP) have been completed (see Article 13 No 3 of Regulation No 469/2009 and Art. 36 of Regulation (EC) No 1901/2006).

The paediatric extension of the SPC term was established as an incentive and reward for pharmaceutical companies for the investment and effort put into clinical studies testing the safety and efficacy of a medicinal product in the paediatric population.

The paediatric-use marketing authorisation (PUMA) is a dedicated marketing authorisation covering the indication (s) and appropriate formulation(s) for medicines developed exclusively for use in the paediatric population. These authorisations apply to medicines that are already authorised (for adults) and are no longer protected by a patent or an SPC. The development of a PUMA also follows an agreed Paediatric Investigation Plan (PIP).

The grant of a PUMA provides the applicant with a new data protection period of eight years, followed by two years of market exclusivity. This type of MA is governed by Regulation (EC) No 1901/2006.

The “orphan designation” is a status granted by the European Commission, upon the recommendation of the EMA, to a medicine intended for use against a rare condition in accordance with Regulation No 141/2000. Orphan-designated drugs have the advantage of a ten-year orphan exclusivity. This period can be extended by up to two additional years if clinical studies are completed in accordance with an agreed PIP. Proposed plans to reform the EU pharmaceutical legislation may alter regulatory exclusivity periods. Currently, orphan drugs are not eligible for SPC term extensions. To apply for a paediatric six-month SPC extension, the orphan designation must first be withdrawn.

Instead of a permanent injunction in the main proceedings, German law provides a right to commence provisional injunction proceedings separately from the main proceedings. We have addressed the relief available in those proceedings under 1.3 Provisional Injunction Proceedings.

A first-instance judgment in favour of the plaintiff may include an order to cease and desist from undertaking certain specified activities (permanent injunctive relief) as well as further claims of relief, such as the recall and destruction of infringing products.

The enforcement of a first-instance judgment that is not (yet) final requires the plaintiff to provide security (often in the form of a bank guarantee) to the defendant for damages incurred due to the enforcement, should the judgment be overturned on appeal. The amount of security is within the court’s discretion but is usually set at the same level as the value in dispute on which the court fees and reimbursement claims are based (see 5.5 Legal Costs).

To enforce the cease-and-desist order, the plaintiff must indicate to the defendant that the judgment is enforced by serving a copy of the judgment and the aforementioned security.

The defendant can petition the appeal court to stay the enforcement, but this is granted only in exceptional cases.

German law provides for a compulsory licence action, which can be brought before the Federal Patent Court. To prevail in this action, the applicant must demonstrate that:

• they have unsuccessfully tried to obtain a use right from the proprietor on reasonable terms; and
• the public interest calls for the grant of a compulsory licence.

A public interest exists in cases where the use right is required to provide a medicament for a serious illness that has either greater efficacy or fewer side effects than any other available medicament.

Besides this specific provision, before granting an injunction, a court must generally consider whether circumstances exist according to which the injunction would lead to disproportionate hardship for the infringer or third parties, relative to the plaintiff’s interest in excluding them based on the intellectual property right granted to him. German courts apply this only in very exceptional cases, and in principle, it cannot replace the above action for a compulsory licence.

In German infringement proceedings, plaintiffs typically request only a declaration establishing the defendant’s liability for damages and an obligation to render accounts, rather than seeking a specific monetary award in the initial action. Upon obtaining the rendering of accounts, the plaintiff can commence a follow-on lawsuit, claiming payment of a specific amount of damages.

Damages are only meant to compensate for a loss suffered, not to penalise. In general, German courts are conservative regarding the amount of damages awarded.

Those damages can be calculated according to the methods of:

• lost profits;
• infringer’s profit; and
• reasonable royalty.

The plaintiff has discretion regarding the calculation method applied and can even use different methods for different periods.

It very rarely leads to a follow-on action on the amount of damages, because the parties generally reach an out-of-court settlement once infringement has been established in a final decision or earlier due to threatened or enforced injunctive relief. As such, the case law on the amount of damages is limited, and therefore, no industry-specific conclusions can be drawn.

The court’s decision includes a determination of:

• which party bears the legal costs; or
• where costs are shared, the allocation of those costs between the parties.

The legal costs include, in particular:

• the court fees (advanced by the plaintiff); and
• the adversary’s attorney fees.

Both depend on the value of the dispute, which the court also determines based on the parties’ submissions or the court’s own findings of fact, usually during the main hearing.

In principle, the losing party pays the legal costs. However, a plaintiff must bear the legal costs of litigation if:

• the defendant’s conduct did not give justified cause to resort to litigation; and
• the defendant immediately acknowledges the claim.

The plaintiff can avoid this risk by sending a warning letter, but this decision must be made on a case-by-case basis, as outlined below.

• How likely is an immediate acknowledgement?
• Is such a quick win potentially worth bearing the legal costs?
• What risks does sending a warning letter bring in a specific situation?

German courts have no discretion to reduce or withhold relief because of a plaintiff’s conduct unless the plaintiff holds a dominant position and if the conduct constitutes an abuse of that dominant position under competition law (Article 102 TFEU).

There are no special rules for trademarks in the pharmaceutical or life sciences sectors, so any trademark must not be misleading or cause confusion with a pre-existing trademark.

In the life sciences field, trademark disputes are most common in repackaged pharmaceuticals for parallel import.

It is currently unknown if there are any copyright disputes in the life sciences and pharma sector in Germany.

Trade secret disputes are, so far, not very common in Germany’s pharma and life sciences sector.

Main infringement judgments and judgments in provisional injunction proceedings can be appealed at the higher regional courts. A further appeal at the Federal Court of Justice (FCJ) on a point of law is possible only in main infringement proceedings.

In nullity proceedings, the FCJ is the appellate instance, so that the bifurcated tracks of the German system converge there.

The higher regional courts and the FCJ also have specialised patent panels.

Patent infringement proceedings are subject to the same rules as any other civil procedure case.

Special provisions only apply to nullity proceedings.

The Unified Patent Court (UPC) has made a promising start, with cases from the life sciences and pharmaceutical sectors being heard there. However, national litigation continues to play a more significant role in this field, and this trend is likely to continue for the foreseeable future.

Mediation and other forms of alternative dispute resolution are available and may be suggested by the court under Section 278a GCCP, but they require the consent of both parties. The parties are also free to agree on any alternative approach to resolving their dispute, eg, through an expert determination. The parties may agree on such ADR once a dispute has arisen or in advance, as often is the case in IP contracts.

Objective statistics that provide a clear picture of the use of ADR to resolve disputes in life sciences are not available. Seemingly, ADR plays a role, either through contractual dispute-resolution clauses or through agreements made at the time of the dispute, but it is extremely rare compared to litigation.

The EU Commission, as the competent antitrust authority for the entire European Union, is closely monitoring the pharma and life sciences sector, including abuses of dominant positions and agreements that violate competition law. The EU Commission has been particularly critical of settlements that limit generic entry and include a value transfer to the generic company.

Group claims are only available regarding unfair practices against consumers. They can be brought by consumer advocacy organisations and are designed to assist consumers who have suffered minor damages and are unable to pursue their own legal action. They are not very relevant in the life sciences and pharma sector.