Pharma owners warned of Brexit effect on TMs
Large market for parallel or ‘grey’ imports of pharmaceuticals due to pricing differences in various countries | Govt consultation respondents unhappy with ‘lack of EU reciprocity’| Mewburn Ellis.
Pharmaceutical trademark owners should keep a close eye on future developments in the UK trademark exhaustion regime in the wake of Brexit, a new report has urged.
Following the release of the findings of the UK government’s public consultation on the future exhaustion of IP rights and parallel trade, Mewburn Ellis today, November 22, released the study “Trademark Exhaustion and Parallel Trade of Pharmaceuticals in the UK: what next?”
Commenting on the report, Rebecca Anderson-Smith, partner and chartered trademark attorney at Mewburn Ellis, said: “Before Brexit, dealing with the trademark issues under a European distribution agreement was relatively straightforward.
“Now, however, the impact of the different exhaustion regimes within Europe needs to be accounted for. At the same time, pharmaceutical trademark owners continue to see parallel imports of their goods into the UK, often in spite of their commercial interests.”
The EU currently has a regime of EEA regional exhaustion, whereby IP owners’ rights over their goods are ‘exhausted’ once they are put on the market in the EEA under a trademark.
This means that IP rights in goods first placed on the market in the EEA are considered exhausted in the UK, and these goods can be imported into the UK without the right owner’s permission, subject to certain conditions.
According to the report, there is a considerable market for these parallel or ‘grey’ imports of pharmaceuticals in the UK and the EU, due to the significant difference in pricing of these products across the different countries.
This means that a trademark owner may find their goods being sold in countries where they never intended them to be on the market, added the study.
The report further noted how the government’s consultation’s respondents favoured the current unilateral application of the EEA regional exhaustion regime (termed ‘UK+’), while also expressing unhappiness at the lack of reciprocity from the EU.
Consequently, the UK will retain its current exhaustion regime, but the report underscored how the UK government has not ruled out the possibility of making changes to its trademark exhaustion and parallel trade regime in the future.
Anderson-Smith observed: “For the moment the government has held off making any changes to the regime. However, the landscape is complex and it is vital that pharmaceutical trademarks owners keep abreast of developments as we may well see changes from the UK government in the future.”
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