There is a natural contradiction between the legal protection of patent right and the anti-monopoly law. Through translation, this paper introduces the case of Bayer Company in the United States, analyzes whether Bayer Company's behavior constitutes monopolistic behavior, and how to balance the relationship between antitrust and intellectual property protection, hoping to provide another reference example for the judicial practice of antitrust law in China.
Keywords: patent antitrust abuse of market dominance Bayer Company
order
There are some contradictions between the legal protection of patent right and the anti-monopoly law. When there is a contradiction between the two, how to balance the relationship between them and which is more important has always been a controversial issue in the industry. China's Anti-monopoly Law was promulgated and implemented on August 1 2008, but so far, there are few cases of patent right and anti-monopoly in China. Through sorting and translation, the author introduces the case of Bayer Company in the United States, and will analyze whether Bayer Company's behavior constitutes monopolistic behavior and how to balance the relationship between antitrust and intellectual property protection, hoping to provide another reference example for the judicial practice of domestic antitrust law.
I. Brief introduction of the case
This case originated from a "settlement agreement" signed by Bayer Company and three pharmaceutical manufacturers represented by Baer in 1997, which involved a patent related to the active ingredient of antibiotics, cipro. Bayer finally signed this agreement in order to prevent Barr's invalid claim to this patent and effectively exclude three pharmaceutical companies including Barr from competing with it to sell CIPRO-related products.
Bayer is the owner of CIPRO patent (the patent 1987 was obtained on June 2, 2004, and the protection period expired on April 9, 2004). 19911On June 6, 2, Barr announced that according to Hatch-Waxman Act 3 of the United States, the company has applied to the US Food and Drug Administration (FDA).
1 Bayer case content is translated and edited based on Lexis English database. Case database number: 2006 WI App 102, *; 293 Wis. 2d 770，* *； 7 18 N.W.2d 25 1，* * *； 2006 Wisc。 App。 Vocabulary 405
2 Three pharmaceutical manufacturers: Barr Laboratories Limited ("Barr"), Hoechst Marion Rousseau Limited ("HMR") and Rugby Group ("Rugby").
The Hatch-Wachsman Act of the United States provides some incentives to support the development of generic drugs with expired patents, and at the same time allows patent owners to make up for the time lost in the approval process of the US Food and Drug Administration (FDA).
case analysis
Bayer will have 45 days to sue Barr for patent infringement according to Hatch-Waxman law in the United States, and can obtain the license to sell CIPRO imitation products. 199265438+1October 16, Bayer sued Barr in the southern administrative region of new york, accusing Barr of infringing his patent, and the FDA suspended the examination and approval of Barr's application. During the defense, Barr and rugby (one of the three major pharmaceutical companies) filed a patent invalidation request against Bayer and counterclaimed for the public.
Before the case entered the court of first instance, that is,199765438+1October 8th, Bayer signed the Settlement Agreement with BAR * * *, and finally signed the Settlement Agreement with three pharmaceutical manufacturers. The agreement has carved up the entire CIPRO product market in the United States for at least six years. The contents of the agreement include: Bayer paid Barr and HMR a total of about 398 million US dollars. In exchange, Barr acknowledged the validity of the CIPRO patent and promised not to compete with Bayer in the CIPRO and CIPRO-related products market in the United States. Based on this agreement, Bayer maintained a monopoly position in the CIPRO and CIPRO related products market in the United States. During the period from 1997 65438+ 10 to199865438+February, the price of CIPRO products sold by Bayer increased by 16.7%, making it one of the products with the biggest price increase in the United States. According to the internal sales documents, the company's tax revenue and profits increased significantly after the signing of the agreement. From 1998 to 1999, the national tax paid by Bayer from CIPRO project increased from 834,620,400 USD to 1.042473 100 USD.
On June 6th, 2000, the Appellant filed a lawsuit on behalf of himself and a consumer group in Wisconsin, USA, which recognized CIPRO products because of its trademark. The appellant claimed that the anti-monopoly "settlement agreement" between Bayer and Barr and other manufacturers fixed the market sales price of CIPRO and CIPRO-related products, which caused Wisconsin residents in the United States to pay a much higher price for purchasing CIPRO and CIPRO-related products than without this agreement. This kind of behavior actually harms the interests of the people of Wisconsin, which has a negative impact on the state and violates Ch65438 of Wisconsin Anti-monopoly Law.
The state court of first instance held that CH 133 was only applicable to intra-state trade, and dismissed the prosecution on this ground. The court of second instance held that CH 133 is applicable not only to intra-state trade, but also to inter-state trade in some cases. The court ruled that the court of first instance misunderstood the Wisconsin anti-monopoly law and should support the defendant's original judgment of violating the Wisconsin anti-monopoly law. The court of second instance overturned the judgment of the court of first instance.
After the appeal of the case, the Supreme Court of the United States held that the court of second instance held that the court of first instance had misunderstood the Wisconsin antitrust law, and should support the claim that the defendant had violated the Wisconsin antitrust law, and that the behavior originally informed the defendant had substantially harmed the interests of the people of Wisconsin and caused adverse effects to the state. However, fixed prices and monopolistic behavior are legal within the validity period of the patent, but illegal outside the validity period, which violates the anti-monopoly law of Wisconsin.
Second, the case analysis
In this case, Bayer, as the right holder of CIPRO patented products, has been given a monopoly position to produce or sell CIPRO products within a limited time and a certain geographical scope within the validity period of CIPRO patents, that is, from the date of signing the contract 1997 1.8 to the expiration date of the patent protection period on April 9, 2004.
4 Wisconsin Statistics. 133.03: (1) Any contract that restricts interstate or foreign trade or commerce, in the form of trust or other forms of association or conspiracy, is illegal. Anyone who signs the above contract or engages in the above association or conspiracy will constitute a felony. If it is an individual, the fine shall not exceed 100000 USD; For other participants, a fine of not more than $50,000 will be imposed. (2) Anyone who monopolizes or attempts to monopolize, or conspires with others to monopolize interstate or foreign commercial trade will constitute a felony. If it is an individual, the fine shall not exceed 100000 USD; For other participants, a fine of not more than $50,000 will be imposed.
Monopoly refers to the behavior that operators or their interest representatives abuse the dominant market position they already have, or seek or abuse the dominant market position through agreement, merger or other means to exclude or restrict competition and obtain excess interests, which should be regulated according to law.
The price or compensation made by monopoly power legalizes the purpose of obtaining monopoly profits. In other words, this stage is to protect monopoly by law, which can reduce people's desire to deprive others of their property by violence and fraud, thus encouraging people to engage in more production and business activities and create more social wealth.
However, after the expiration of the CIPRO patent, that is, after April 9, 2004, Bayer lost its exclusive monopoly on CIPRO products. If Bayer continues its usual monopolistic behavior after this point in time, it may lead to the abuse of market dominance by using expired patents. Because, when the patent expires, as the operator of CIPRO products or the representative of their interests, they no longer enjoy the monopoly position protected by law. Since then, Bayer's monopolistic behavior is subjectively seeking excess benefits, and objectively there are behaviors that exclude or restrict competition. The purpose of behavior is to maintain or improve the market position and obtain excessive monopoly benefits. The consequence of this behavior is to cause substantial damage or possible damage to market competition, so it is illegal to some extent. After the expiration of the patent protection period, Bayer, Barr and other manufacturers still fixed prices according to the content of the Settlement Agreement, excluding competition, which fully meets the constitutive requirements of monopolistic behavior.
Furthermore, after the expiration of the patent protection period, Bayer's monopolistic behavior belongs to the abuse of market dominance, which is manifested as a monopoly high price type. Bayer, as the operator of CIPRO products, has great influence in the market of CIPRO related products. In order to further eliminate competition, it signed a "reconciliation agreement" with three pharmaceutical manufacturers, such as Baer, to redistribute resources and interests, so that it occupied almost all the market share in the related product market and related regional markets in Xipu, and other competitors could not compete with it. Because the market entry or exit of the pharmaceutical industry is very difficult, CIPRO products, as one of the most commonly used antibiotics, have a high market concentration. The more consumers depend on it, the higher the market dominance of Bayer Company. Bayer Company relies on this company's market dominance to determine the sales price far higher than the average profit rate of society to sell its CIPRO products and seize excess monopoly profits.
This monopolistic high-priced behavior not only substantially harms the interests of consumer groups, but also makes itself lose or greatly reduces the internal motivation of improving management and promoting technological progress through equal competition, which hinders the growth of social welfare and loses the overall welfare of society. At the same time, this kind of behavior also tramples on the rules of fair trade, destroys the order of fair competition, plunders social assets and infringes on the interests of other operators. Therefore, if Bayer still has a long-term and stable monopoly position in this case, it may lead to low social and economic benefits. Therefore, the behavior of using market dominance to hinder competition at this stage should be regulated by the Anti-Monopoly Law.
III. Concluding remarks
The case of Bayer Company in the United States given in this case at least shows that the patentee's dominant market position and monopolistic high-priced behavior are legal within the validity period of the patent, and during this period, under the premise of safeguarding public interests and maintaining effective competition in the market, it is given the greatest possible protection. However, this kind of protection is not indefinite and unlimited. Continuing the same behavior outside the patent validity period may constitute a monopolistic behavior, which is illegal and should be governed by the Anti-Monopoly Law at this time.