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Generic Drugs Company Wins Record £27 Million Damages

A pharmaceutical company which obtained an injunction to protect its patent rights in respect of one of its most successful products ended up being hit with a record £27 million damages bill after the order turned out to have been wrongly granted.

Company A held a patent in respect of a drug used to treat various gastric disorders. Company B planned to market a generic version of the drug in Britain at a lower price. Company A launched proceedings for alleged patent infringement and obtained an interim injunction which prevented company B from launching its rival product. The order was made subject to the usual undertakings that company A would pay damages to company B if it subsequently emerged that the injunction should not have been granted.

In separate proceedings, another company subsequently established that its own generic product did not infringe the patent. In the light of that decision, company A’s injunction was discharged. However, by then, others were ready to launch generic versions of the drug and company B had lost the substantial competitive advantage it would have enjoyed as the first entrant into the market.

Company A was later ordered to pay company B more than £27 million in damages, which was believed to be the largest award ever made by the Patents Court in such a case. In rejecting company A’s challenge to that decision, the Court of Appeal found that the award was properly founded on the evidence and accurately reflected the loss suffered by company B as a result of the injunction.