An effective defense strategy against patent lawsuits by an original manufacturer in the pharmaceutical market is based on four interrelated vectors: timely Freedom-to-Operate (FTO) patent audits, legitimate application of the Bolar exemption during generic registration, proactive judicial invalidation of weak secondary (“evergreen”) patents, and filing appeals with the Antimonopoly Committee of Ukraine (AMCU) to block anti-competitive actions by the originator.
- Abolition of Patent Linkage: the mere fact of filing an application for state registration of a generic medicinal product in Ukraine no longer constitutes a direct patent infringement, provided that the introduction of the drug into civil circulation is postponed until the expiration of the basic patent.
- Bolar Exemption (Bolar Exception for Research Purposes): the import of active pharmaceutical ingredients (APIs), formulation development, bioequivalence studies, and the state registration procedure are protected under Article 31 of the Law of Ukraine “On Protection of Rights to Inventions and Utility Models”.
- Destruction of “Evergreen” Patents: secondary patents on polymorphs, isomers, new salts, finished dosage forms, or new dosages are subject to invalidation due to a lack of inventive step or therapeutic efficacy.
- Counter-Defense Against Interim Relief: blocking product registration or prohibiting market circulation at the stage of an interim relief ruling is a disproportionate measure consistently overturned by the Supreme Court.
- Antimonopoly Control: originator pressure through unjustified lawsuits, threats of license revocation, and “pay-for-delay” settlement agreements fall under the direct jurisdiction of the AMCU as abuse of monopoly position and anti-competitive concerted practices.
The pharmaceutical market remains the most aggressive battleground in the field of intellectual property. When the basic patent for an active pharmaceutical ingredient (API) expires, the originator faces the threat of losing multi-million dollar profits due to the so-called “patent cliff”. With the entry of affordable generic copies, drug prices drop by 40–80%, prompting multinational pharmaceutical giants to deploy a massive arsenal of legal containment tools: from building artificial “patent thickets” to aggressive pressure on regulators and distributors.
For Ukrainian generic manufacturers, passive defense is a guaranteed defeat resulting in production shutdowns, seizure of product batches at customs, and liability for damages. Modern judicial practice demands a systematic, offensive defense. In this article, we will thoroughly examine the procedural, substantive law, and regulatory mechanisms that allow you to neutralize threats from the patent holder, successfully navigate registration without disruptions, and securely establish a foothold in the market.
—Unfair Competition in Pharmaceutical Patent Disputes
Patent protection was created as an incentive for technological progress and a fair reward for colossal investments in clinical research. However, in pharmaceuticals, patent law frequently turns into a weapon for directly suppressing market competitors. Original companies, attempting to extend a 20-year monopoly for another 10–15 years, resort to practices that cross the line of fair business conduct.
The key legal conflict lies in distinguishing between the legitimate protection of intellectual property rights and the abuse of rights aimed at restricting competition. From the perspective of Article 10-bis of the Paris Convention for the Protection of Industrial Property and Ukrainian legislation, actions exhibiting signs of unfair competition may include:
- Artificial delay of generic drug market entry: systemic lawsuits against the Ministry of Health of Ukraine (MOH) and the State Expert Center of the Ministry of Health of Ukraine (SEC) demanding the suspension of the expert examination of generic registration materials;
- Abuse of interim relief institutions: initiating court bans on the customs clearance of substances or the commercial release of medicines in the absence of an actual commercial sale;
- Discrediting the generic manufacturer: sending cease-and-desist letters to pharmacy chains, distributors, and public procurement organizers, threatening them with joint and several liability for selling allegedly counterfeit products;
- Patent trolling via utility models: registering obvious modifications of known molecules or their administration methods under a declarative principle solely to blackmail manufacturers.
When such actions are recorded, initiating an investigation with the Antimonopoly Committee of Ukraine serves as an effective containment tool. Comprehensive legal protection against unfair competition alters the balance of power, turning the originator from a prosecutor into a defendant facing the threat of multi-million fines (up to 5% of revenue for violations of legislation on protection against unfair competition and up to 10% for abuse of monopoly position).
Read the analytical material on unfair competition and patent disputes in the pharmaceutical market for details on the qualification of such abuses and the formation of an evidentiary base.
Pay-for-Delay Settlement Agreements and Antimonopoly Risks from the AMCU
Settlements known as pay-for-delay or reverse payment settlement agreements pose a particular danger to generic companies. The mechanics of such agreements look appealing on the surface: the originator pays the generic manufacturer significant financial compensation, grants a technology license for other markets, or covers legal costs, while in exchange, the generic company acknowledges the validity of the disputed patent and undertakes not to enter the market until a specified date.
However, such agreements are subject to the strictest scrutiny by antitrust authorities worldwide (recall landmark European Commission precedents in the Lundbeck, Servier, and Generics (UK) cases). In Ukraine, such agreements directly fall under the criteria of anti-competitive concerted practices prohibited by Article 6 ofليات the Law of Ukraine “On Protection of Economic Competition” (market allocation by product range, refusal to manufacture or sell goods, establishing artificial market entry barriers).
- Criterion of reverse payment existence: does the generic company receive direct monetary compensation or other non-market assets in exchange for dropping a patent challenge? If so, the agreement exhibits toxic anti-competitive features.
- Genuineness of the legal dispute: if the patent conflict was artificially staged by the parties solely to conclude a settlement agreement under judicial supervision, the risk of qualifying it as a cartel conspiracy is critical.
- Justification of the postponement: does the period of market entry prohibition exceed the actual lifespan of a valid patent?
- Assessment of patent survival chances: did the originator know about the high probability of its patent being invalidated when concluding the settlement agreement?
Any settlement agreement between an originator and a generic manufacturer in Ukraine must be accompanied by a preliminary compliance audit regarding antitrust legislation or even the procedure for obtaining preliminary conclusions or AMCU clearance for concerted practices to avoid devastating financial sanctions in the future.
—Protection Against Patent Trolling and Blocking Applications
The most widespread form of opposing generic entry is so-called “evergreening”. When the patent term for the basic molecule (active substance) nears its end, the originator’s R&D department generates dozens of dependent and secondary applications. The goal is simple: to create a minefield through which the generic manufacturer cannot pass without the risk of litigation.
The anatomy of “evergreen patents” typically boils down to the following objects:
- Polymorphic modifications and crystalline forms: patenting a specific spatial lattice or solvate of an already known substance, which is a natural property of the compound.
- Optical isomers (enantiomers): isolating a pure isomer from a previously patented racemic mixture without creating a fundamentally new pharmacological effect.
- Pharmaceutical compositions and finished dosage forms: combining the active substance with standard excipients (fillers, stabilizers, modified-release coatings).
- New dosing regimens or routes of administration (second medical use): identifying a new indication for treating another disease using an already known substance (the so-called “Swiss-type” patent claim format).
To mitigate these risks, a timely preventive strategy is required, which is detailed in our study on how to protect a pharmaceutical brand from patent trolling and blocking applications.
| Patent Type | Subject Matter | Legal Vulnerability | Primary Challenge Tool |
|---|---|---|---|
| Basic Primary Patent | Chemical compound (Markush structure), active substance (API). | Minimal. Challenged extremely rarely, mostly due to priority or disclosure defects. | Wait for expiration (20 years + SPC up to 5 years) or apply the Bolar exemption. |
| Polymorph / Salt Patent | Crystalline modification, hydrate, salt of the base molecule. | Lack of inventive step; obviousness of routine salt screening; lack of unexpected synergistic effect. | Invalidation lawsuit under Art. 7 of the Inventions Law; forensic chemical-pharmaceutical examination. |
| Composition Patent | Mixture of the active substance with standard excipients. | Obviousness to a person skilled in the art; lack of new therapeutic action (rule of thumb in pharmaceutical technology). | Opposition to the Appeal Chamber of the IP Office or court lawsuit referencing prior art. |
| Second Medical Indication | Use of a known agent to treat a new diagnosis. | Impossibility of monopolizing treatment methods (in certain jurisdictions); challenging patent claims. | Skinny labelling (omitting the protected indication from the generic package leaflet). |
Patentability Criteria and Lack of Inventive Step
With the harmonization of Ukrainian legislation with EU law under the Association Agreement and amendments to the Law of Ukraine “On Protection of Rights to Inventions and Utility Models”, requirements for secondary patents have significantly tightened. According to part 2 of Article 7 of the Law, human treatment and diagnostic methods are not recognized as inventions. Furthermore, a direct statutory norm limits the patenting of new forms of known medicines (including salts, esters, polymorphs) unless they exhibit significantly different properties regarding efficacy.
This enshrines the well-known European and Indian “Novartis rule” in domestic legal practice: patenting a modification of a known molecule without proving a therapeutic advantage is inadmissible. For a generic manufacturer, this opens a wide flank for attacking secondary patents both at the application examination stage in the National Intellectual Property Office (IP Office) and during judicial patent invalidation.
—Threats of Generic Lawsuits: Company Action Plan
Receiving a Cease and Desist letter from the lawyers of a multinational pharmaceutical corporation is a standard stage in launching any in-demand generic. The goal of such a letter is not necessarily immediate litigation. Most often, it is psychological pressure on company management aimed at forcing them to halt registration procedures or reveal their legal defense strategy.
If your company faces such a threat, it is vital to avoid chaotic actions, concealing the problem, or prematurely admitting infringement. We covered a detailed response protocol to such notifications in our article on how a pharma company lawyer should act if the originator threatens a lawsuit over a generic.
Below is a structured architecture of defensive actions in the event of a direct conflict with the originator:
Key Action: Comparing the originator’s patent claims with the technological chart, substance composition, and generic dossier.
Goal / Requirement: Verify the patent status in the state register (whether annual fees are paid, whether the supplementary protection term has expired).
Result: Obtaining a Freedom-to-Operate (FTO) opinion from a certified patent attorney.
Key Action: Establishing the legality of substance import and bioequivalence studies under the research exemption (Art. 31 of the Inventions Law).
Requirement: Existence of R&D contracts, pre-clinical and clinical trial protocols, SEC MOH dossier.
Result: Ensuring complete immunity against allegations of improper patent use at the registration stage.
Action: Dispatching a rigorous legal response to the Cease and Desist letter refuting the allegations.
Requirement: Referencing lawful preparation for registration without intent to sell prior to patent expiration.
Result: Warning the originator about appealing to the AMCU and filing a counter-lawsuit for patent cancellation in case of litigation.
Authority / Action: Submitting procedural objections to the commercial court in case of attempts to halt drug registration or customs clearance.
Grounds: Violation of proportionality criteria and prohibition of resolving the merits of the dispute through interim measures.
Result: Court refusal to issue an interim relief ruling or its immediate cancellation on appeal.
Decision: Initiating a parallel lawsuit to invalidate the patent + filing an AMCU complaint regarding unfair competition.
Result: Complete annulment of the originator’s patent or conclusion of a settlement agreement on terms favorable to the generic company without paying settlements.
Bolar Exemption as a Defense Tool for the Generic Manufacturer in Court
The cornerstone of protecting generic manufacturers’ rights is the norm of part 2 of Article 31 of the Law of Ukraine “On Protection of Rights to Inventions and Utility Models” — the so-called Bolar provision. This norm explicitly provides that using an invention for research or experiments, as well as preparing and submitting information to obtain marketing authorization for a medicinal product, is not recognized as a patent infringement.
For a long time, an artificial “patent linkage” operated in Ukraine — an automatic connection between drug registration with the Ministry of Health and the existence of active patents. Originators mass-filed lawsuits to ban the state registration of generics, arguing that the very act of applying to the SEC constituted patent infringement.
The Grand Chamber of the Supreme Court and the Joint Chamber of the Cassation Commercial Court put an end to this flawed practice:
“State registration of a medicinal product in itself does not constitute putting goods into economic circulation within the meaning of civil and patent law. Submitting registration materials, conducting bioequivalence studies, and the expert examination procedure are aimed exclusively at confirming the safety and efficacy of the drug and fall under the legal regime of the research exemption. Banning state registration of a drug before the expiration of the patent term is a premature and unlawful restriction of the generic manufacturer’s rights.”
The practical boundaries of applying the Bolar exemption in Ukraine today cover:
- Importing samples of the active pharmaceutical ingredient in quantities strictly necessary for analytical research, laboratory batch development, and bioequivalence studies;
- Synthesizing laboratory and pilot batches of the drug to study stability;
- Submitting a registration dossier to the SEC of the Ministry of Health of Ukraine long before the expiration of the basic patent;
- Obtaining a marketing authorization subject to the obligation not to bring the drug to market until the patent expires or until it is invalidated.
Fighting Interim Relief: Stopping Market Bans on Medicines
The most toxic blow an originator can deliver is obtaining an interim relief ruling at the initiation of court proceedings in the form of:
- Banning the Ministry of Health of Ukraine from making registry changes or deciding on generic state registration;
- Banning the State Customs Service from clearing imports of substances or finished forms;
- Banning distributors and pharmacy chains from selling and advertising the drug.
Such measures can completely freeze a company’s business for 1–2 years of litigation, even if the originator’s claim is subsequently dismissed in full. To defeat such motions, a lawyer must apply Supreme Court practice:
- Disproportionality of measures: granting interim relief through a total ban on registration or sales essentially resolves the dispute on the merits prior to reviewing evidence and appointed forensic examination, which is expressly prohibited by the Commercial Procedure Code of Ukraine.
- Public interest: blocking available generic drugs deprives patients of access to vital therapy and harms the state budget through purchases of overpriced original drugs under the “Affordable Medicines” program or central procurements.
- Requirement of cross-undertaking in damages: petitioning the court to require the originator-plaintiff to deposit funds into the court’s deposit account covering potential losses incurred by the generic company due to downtime (often tens of millions of hryvnias). The necessity of depositing real funds frequently forces the plaintiff to abandon blocking intentions.
Claim Work and Forensic Examination
If a judicial clash is unavoidable, the outcome of a patent dispute is 90% determined by the quality of preparation for intellectual property forensic examination. A pharmaceutical patent dispute is not a contest of abstract rhetoric, but a war of chemical formulas, nuclear magnetic resonance (NMR) spectrograms, X-ray powder diffraction analysis, and equivalence criteria.
When assessing infringement risks, one must remember that parallel to patents, originators attempt to build comprehensive protection systems that also include industrial designs and trademarks, whose legal status is secured by the Law of Ukraine “On Protection of Rights to Trademarks for Goods and Services”. Attempts to monopolize a capsule’s color scheme or blister pack shape are yet another manifestation of unfair blocking, which is refuted during judicial defense.
Furthermore, today a portion of information-registration procedures is optimized thanks to public services — for instance, rights monitoring and basic interactions with state authorities are available through IP services on the Diia portal, significantly simplifying the collection of official extracts during claim work.
Forensic Examination in Pharma IP: How to Turn the Tide
Commercial court judges lack professional knowledge in bioorganic chemistry or pharmacokinetics, so the opinion of a court-appointed certified intellectual property forensic expert essentially becomes the basis for the court decision. Two key categories of expert examinations are used in patent cases:
- Examination regarding patent infringement: verifying whether the generic medicinal product contains each feature of the invention included in an independent claim of the patent, or an equivalent feature (doctrine of equivalents). If even a single claim feature is missing in the generic, there is no patent infringement.
- Examination regarding compliance with patentability conditions: a counter-examination initiated by the generic company designed to prove the lack of “novelty” or “inventive step” in the originator’s disputed patent based on global prior art (articles, publications, prior patents).
Establishing a Reliable Defensive Architecture for Pharmaceutical Business
Protecting a generic manufacturer against the patent aggression of multinational corporations cannot be a situational measure triggered only after a court courier’s visit. Modern pharma business requires implementing a comprehensive defensive system based on the Patent Clearance by Design principle, where every stage of drug development is accompanied by IP control.
A winning strategy always combines three dimensions: deep prior art analytics at the stage of synthesis or substance procurement, aggressive destruction of artificial “evergreen” monopolies through patent invalidation lawsuits, and an effective antitrust shield. The patent holder’s attempts to block state registration or impose a judicial seizure on available medicines must be immediately qualified as an act of unfair competition, accompanied by initiating a corresponding AMCU investigation.
The Polikarpov Law Firm team possesses over 20 years of experience representing pharmaceutical manufacturers in the most complex patent battles, overcoming regulatory rejections, and protecting rights in courts of all instances. We help businesses timely identify patent traps, repel aggressive opponent attacks, and ensure the unhindered market entry of high-quality generic products in Ukraine.
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