REGENERON PHARMACEUTICALS, INC v KYMAB LTD (No. 2)

[2018] R.P.C. 15 605 REGENERON PHARMACEUTICALS, INC v KYMAB LTD (NO. 2) COURT OF APPEAL [2018] EWCA Civ 1186; [2018] R.P.C. 15 Patents – European patents – Pharmaceuticals – Antibody production – Genetic engineering – Transgenic mice – Infringement – Validity – Appeal to Court of Appeal – Decision below overturned – Terms of injunctive relief – Whether to extend to non-infringing eukaryotic cells – Scope of disclosure to be ordered – Costs on appeal and below – Successful argument not advanced below – Apportionment as between codefendants – Interim costs order – Stay pending further appeal – Whether to impose conditions H1 H2 Following the handing down of the Court of Appeal’s judgment in these proceedings for patent infringement1, various issues remained as to the terms of the relief to be granted and as to costs. The patents in suit related to the production of human antibodies using transgenic mice. At the trial of the action the claimant (“Regeneron”) had alleged, inter alia, that three strains of transgenic mice of the first defendant (“Kymab”), referred to as HK, HL and HKL, infringed. Kymab had denied infringement and counterclaimed for revocation of Regeneron’s patents for lack of novelty, lack of inventive step and insufficiency. Regeneron had also advanced claims of infringement against a second defendant (“Novo”) but these had been discontinued shortly before trial. Novo’s own invalidity attack remained however. At the trial of the action, Henry Carr J. had dismissed both the novelty and obviousness attacks on the validity of the patents but had found the relevant claims invalid on grounds of insufficiency. The judge had also held that Kymab’s transgenic mice would have infringed the patents had they been valid. Regeneron appealed against the finding of invalidity on grounds of insufficiency and Kymab cross-appealed on infringement. Novo took no active part, adopting Kymab’s submissions on invalidity. Regeneron had succeeded on its appeal on insufficiency on the basis of arguments which had not been advanced below. Kymab’s crossappeal on infringement had been dismissed. The issues which now arose for determination were (i) permission to appeal to the Supreme Court, (ii) the framing of an exemption from the final injunctive relief to be granted to permit Kymab to take steps to produce non-infringing mice and preserve technical advances unrelated to the patents in suit, (iii) the scope of any order for delivery up or destruction, (iv) whether, and if so to what extent, disclosure should be ordered to assist Regeneron in policing its patent rights in the UK and to secure such relief as it may be entitled to in other jurisdictions, (v) the scope of any enquiry as to damages, (vi) whether it was appropriate for there to be an order that Kymab take steps to disseminate the Court of Appeal’s judgment, (vii) as to the costs both of the 1 Reported at [2018] R.P.C. 14. [2018] R.P.C., Issue 8 ß Crown Copyright This article contains public sector information licensed under the Open Government Licence v3.0 (http://www. nationalarchives.gov.uk/doc/open-government-licence/version/3/) Kitchin, Floyd and Arden L.JJ.: 23 May 2018 606 H3 H5 H6 appeal and below and the quantum of any interim payment or payments, and (viii) whether there should be any stay pending any further appeal to the Supreme Court and, if so, on what terms. By the time of the judgment on these issues, the wording of the necessary exemption from the injunctive relief had been agreed and this is set out at [5] of the judgment reported here. Delivery up or destruction was sought by Regeneron of both infringing mice, mouse embryonic stem cells and mouse eukaryotic cells (the “Products”) and antibodies produced by the method of claim 2 of one of the patents (the “Antibodies”), as well as all “cells engineered to produce such Antibodies” and which were in the possession or control of Kymab in the UK. Kymab accepted that Regeneron was entitled to the delivery up or destruction of Products and Antibodies in Kymab’s possession, custody or control in the UK and the keeping of which would infringe. However it argued that the “cells engineered to produce Antibodies” included cells which were neither infringing products nor articles in which such a product was inextricably comprised. They were simply an intermediate stage in a process which, on the court’s findings, would infringe claim 2. It also argued that delivery up might result in Regeneron learning aspects of its confidential information, and that there should be exemptions both for acts done for purposes of a medicinal product assessment and also for the purpose of producing non-infringing products. The disclosure sought by Regeneron was extensive and is summarised at [15] of the judgment. Kymab objected on grounds, inter alia, that no orders for disclosure had been sought by Regeneron in its prayer for relief, that it had provided a good deal of information already, and that it was difficult to see any basis for the further disclosure now sought. Kymab feared that such disclosure was sought to enable Regeneron to contact Kymab’s customers and collaborators, even if operating in a jurisdiction where Regeneron had no rights or engaged in non-infringing acts such a clinical trials. The arguments on costs were complicated by both the fact that the arguments upon which Regeneron had succeeded on insufficiency had not been run below and Novo’s contention that it was only jointly responsible for 20% of Regeneron’s costs of the validity appeal and that even this element of its costs liability should not be enforced against it unless Regeneron failed to recover its costs from Kymab. Novo argued that an order making it jointly and severally liable for all of the costs of the validity appeal would not do justice between the parties. Kymab sought a stay of both the injunctive relief and any disclosure ordered pending any appeal to the Supreme Court. It offered undertakings pending appeal in the terms set out at [45] of the judgment. In particular, it wished to be free to dispose of or remove from the jurisdiction antibodies and mouse serum for the purposes of both existing and future collaborations funded by the Bill and Melinda Gates Foundation (“the Gates Foundation”), collaborations with the International AIDS Vaccine Initiatives and Heptares Therapeutics Ltd, to engage in new research collaborations, and for the purpose of both clinical and pre-clinical trials. It offered an undertaking from its parent company to pay any damages or costs ordered to be paid by Kymab, should the court consider it necessary. Regeneron resisted some (but not all) of the savings sought by Kymab, arguing, inter alia, that Kymab had not disclosed its agreement with the Gates Foundation and the extent to which that extended beyond humanitarian matters. It objected to any commercialisation of such antibodies by Kymab and also contended that neither Kymab nor the Kymab group wou (...truncated)