Neurim Pharmaceuticals (1991) Ltd & Anor v Generics UK Ltd (t/a Mylan) & Anor

A court may vary or revoke an order before it is drawn up and perfected, and may also use CPR 3.1(7) where justice requires it. The jurisdiction is exceptional and is normally exercised only for a material change of circumstances, material misstatement of the facts, or an error in expressing the order. Concurrent English patent proceedings and EPO opposition proceedings are legally interconnected. A later EPO revocation may therefore justify revisiting consequential orders made by the English court. For costs, the successful party is identified by the real-world outcome, including the relief actually obtained. Where an EPO revocation renders English proceedings pointless, the party whose claim has thereby failed may be liable for the costs, particularly where the parties failed to ask the court to consider an adjournment.

This was a consequential judgment following the trial of patent proceedings between Neurim Pharmaceuticals and Flynn Pharma, and Generics UK and Mylan UK Healthcare. In the earlier judgment, [2020] EWHC 3270 (Pat), the court held the patent valid and infringed, but found that Flynn was not an exclusive licensee.

Before the consequential hearing, Neurim withdrew its appeal against the EPO Opposition Division’s revocation of the European patent. The patent was consequently revoked ab initio. The issues were whether the court had jurisdiction to revisit orders made on 16 December 2020, whether permission to appeal the exclusive-licence issue should remain, and how costs should be allocated.

1. Jurisdiction to revisit orders. The 16 December 2020 orders took effect when made, although they had not been drawn up or perfected. Under the common law and CPR 3.1(7), the court had jurisdiction to vary or revoke them. The jurisdiction was exceptional, but the imminent EPO appeal and its subsequent revocation of the patent constituted a sufficiently unusual and material change of circumstances. The interaction between national patent proceedings and EPO proceedings meant that the proceedings could not be treated as hermetically sealed.
2. Permission to appeal. The exclusive-licensee issue had become academic because the patent had been revoked ab initio. There was no sensible order to appeal, and any appeal had no real prospect of success. The criteria for allowing an academic appeal were not met: the issue lacked sufficient general importance, Mylan had not agreed to proceed or offered a costs indemnity, and there was a real risk that the arguments would not be fully ventilated. Permission was therefore refused.
3. Costs. The successful party was identified by the real-world result. Mylan had sought revocation and, following the EPO revocation, obtained that outcome. It was therefore the successful party, although this was described as a “soft” conclusion requiring consideration of the unusual circumstances. The court rejected a counterfactual assessment of what the EPO or an appellate court might have decided and considered only the actual interaction between the proceedings.
4. The parties knew by June or July 2020 that the EPO appeal was listed for hearing shortly after the English trial. By failing to seek an adjournment, each assumed the risk of wasted costs. There was no blameworthy conduct sufficient to displace the outcome-based starting point. Mylan was awarded the costs of the proceedings and the two consequential hearings, subject to prior inconsistent orders, with a payment on account of £750,000.

• High Court (Patents Court): In [2020] EWHC 3270 (Pat), the patent was held valid and infringed, although Flynn was held not to be an exclusive licensee.
• Court of Appeal: An earlier interlocutory appeal concerning interim relief was dismissed and the High Court order affirmed: [2020] EWCA Civ 793.
• High Court (Patents Court): The present court revoked the consequential orders, refused permission to appeal the exclusive-licence issue, and awarded costs to Mylan.