Republic of the Philippines

REGIONAL TRIAL COURT

11th Judicial Region, Branch __
Davao City

MGT PHILIPPINES, INC. CIVIL CASE NO. 02‐009

Petitioner,
-versus- For: DECLARATORY RELIEF
PFIZER, INC. (Article 39.3, Agreement on
Trade-Related Aspects of
Defendant, Intellectual Property Rights,
otherwise known as “TRIPS”)

PETITION

Petitioner, MGT PHILIPPINES, INC., by counsel, respectfully states:

Parties

1. Petitioner MGT Philippines, Inc. (“MGT”), is a Philippine corporation

engaged in the marketing and distribution of pharmaceutical products. Its office
address is at 6th Floor SEDCCO Building, Rada corner Legaspi Street, Davao City.
Petitioner is represented in this action undersigned counsel in Unit 203, UCPB Bldg.,
San Pedro St. Davao City, where it may be served with summons and other
processes.
2. Respondent Pfizer, Inc. (“Pfizer”), is a Philippine corporation likewise
engaged in the manufacture and distribution of pharmaceutical products. Its
principal address is at 23/F Ayala Life-FGU Center, 6811 Ayala Avenue, Makati
City.

Antecedents
 3. Petitioner MGT is a reputable manufacturer and distributor of
pharmaceutical products. On 8 December 2003, MGT requested the Intellectual
Property Office (“IPO”) to conduct a comprehensive patent search on “Olmesartan
Medoxomil.” The comprehensive patent search yielded negative results.
Accordingly, MGT commenced development of a pharmaceutical composition
containing “Olmesartan Medoxomil.”
4. On 5 February 2004, MGT submitted an application for ACB clearance
for “Olmesartan Medoxomil” with the Bureau of Food and Drugs (“BFAD”). This
submission consisted of documents retrieved from the public domain (copies of
these documents are compiled in the attached blue binders 1 and 2, which form as
integral parts of this Petition). The documents demonstrate the safety and efficacy
of “Olmesartan Medoxomil.” On 14 December 2005, following ACB clearance,
MGT submitted its application for initial registration of its product containing
“Olmesartan Medoxomil.” This submission consisted entirely of test data generated
by MGT itself. On 23 May 2006 and 31 October 2006, BFAD issued the
corresponding certificates of product registration (“CPR”) for Olmezar 20mg and
40mg, respectively. Copies of the said CPRs are attached as Annexes “A” and “A-
1.”

5. As a gesture of good faith, and prior to its intended launch, in a letter

dated 11 August 2005 (Annex “B”), MGT’s General Manager, Mr. Sam Gioskos,
inquired from defendant Pfizer whether it has an existing Philippine patent covering
the compound “Olmesartan Medoxomil.” In its letter of 13 September 2005 (Annex
“C”), Pfizer informed MGT that Philippine Patent Application No. 1-2003-500400,
which is directed to “Olmesartan Medoxomil + Hydrochlorothiazide,” was filed on
19 November 2001 under the name of Sankyo Company Limited (“Sankyo”).
According to Pfizer, Sankyo licensed Pfizer to use the compound.
6. In a letter to Pfizer dated 28 October 2005 (Annex “D”), MGT’s Mr.
Gioskos told Pfizer that its “principal or affiliate did not submit any patent
application that corresponds to or is equivalent to European Patent 0503785” which
covers the compound “Olmesartan Medoxomil.” MGT also stated that Philippine
Patent Application No. 1-2003-500400, which pertains to “Olmesartan Medoxomil
+ Hydrochlorothiazide,” is not an impediment to the launch of MGT’s composition
containing only “Olmesartan Medoxomil.”
7. On 5 June 2006 (Annex “E”), MGT wrote Sankyo, the developer of
“Olmesartan Medoxomil” and Pfizer’s principal, to inquire if Sankyo has patents or
pending patent applications that cover “Olmesartan Medoxomil.” MGT did not
receive any reply, written or otherwise, from Sankyo. Hence, MGT took it to mean
that Sankyo has no patents or pending patent applications for “Olmesartan
Medoxomil.”
8. In view of the absence of any patent or pending patent application
covering “Olmesartan Medoxomil,” MGT decided to proceed with the launch of its
version of the same compound. MGT contracted Hizon Laboratories, Inc. (“Hizon”)
to manufacture its “Olmesartan Medoxomil” product. A copy of the agreement
between MGT and Hizon is attached as Annex “F.”
9. However, on 10 August 2006 (Annex “G”), Hizon informed MGT that
the Legal Department of Pfizer wrote Hizon by e-mail regarding “Olmesartan
Medoxomil.” Per Hizon’s letter, Pfizer claimed that it “currently has market
exclusivity for Olmesartan” pursuant to the Agreement on Trade-Related Aspects of
Intellectual Property Rights (“TRIPS Agreement”) and the Intellectual Property
Code of the Philippines (Republic Act No. 8293 or “IP Code”). Pfizer also claimed
that “it has data exclusivity for at least five (5) years from launch and that MGT used
the same data to register Olmezar,” which Pfizer claims is in violation of the TRIPS
Agreement and the IP Code.
10. On 14 August 2006 (Annex “H”), MGT, through counsel, wrote Pfizer
explaining that: (a) Article 39.3 of the TRIPS Agreement refers only to protection
of undisclosed data that is confidential in nature; and (b) MGT did not use
undisclosed data; instead, it used information that was publicly available. MGT
further explained that “Article 39.3 of the TRIPS Agreement is not data exclusivity
but a form of data protection which is intended to prevent unfair commercial use of
data by third parties.” “Exclusivity” and “protection from acts of unfair competition”
are not the same.
11. On 8 September 2006 (Annex “I”), Pfizer’s counsel, Siguion Reyna
Montecillo and Ongsiako, wrote MGT’s counsel on the matter. It stated as follows:
We disagree with your argument that Article 39.3 of
the TRIPS Agreement is inapplicable to product
registration data lodged with the Bureau of Food and
Drugs (BFAD). TRIPS 39.3 clearly requires member
countries to protect undisclosed registration data against
unfair commercial use and disclosure. The provision also
clearly relates to the pharmaceutical product registration
process and its protection was obviously intended to cover
 pharmaceutical data submitted in the course of such a
process.

Your interpretation of TRIPS 39.3 – that it does not

relate to data or market exclusivity – is a version promoted
by interested sectors of the pharmaceutical industry
seeking to influence contemporary interpretations of the
provision, to their benefit. The literature on the matter does
not bear out this interpretation, however. State parties
respecting the TRIPS 39.3 protections recognize that a
period of data protection is needed, providing innovator
companies with incentive to make the necessary
investment in pharmaceutical test and trial data.
12. In the same letter, Pfizer stated that it “reserves its right to proceed
against any party, including MGT if necessary, to protect its proprietary data against
unauthorized or unfair use.” This statement is clearly a threat from Pfizer that it will
sue MGT in the immediate future.
13. MGT, through its counsel’s letter of 20 September 2006 to Pfizer,
reiterated that:

Article 39.3 of the TRIPS Agreement is not data

exclusivity but a form of data protection which is intended
to prevent unfair commercial use of data by third parties.

xxx xxx xxx

Article 39.3 of the TRIPS Agreement clearly states

that the subject of protection must consist of “undisclosed
test or other data.” Data that is available in the public
domain is not covered by this provision.
14. Recently, MGT received information that Pfizer is spreading news that
it is suing Hizon for manufacturing olmesartan medoxomil. The news is circulating
like wildfire in the pharmaceutical industry. Hence, MGT is left with no recourse
but to seek for declaratory relief.
 Discussion

15. The subject matter of this instant Petition is Article 39.3 of the TRIPS
Agreement, which states, to wit:
Members, when requiring, as a condition of
approving the marketing of pharmaceutical or of
agricultural chemical products shall utilize new chemical
entities, the submission of undisclosed tests or other data,
the origination of which involves a considerable effort,
shall protect such data against unfair commercial use. In
addition, Members shall protect such data against
disclosure, except where necessary to protect the public,
or unless steps are taken to ensure that the data are
protected against unfair commercial use.
16. For a wider perspective on the meaning and scope of Article 39.3, it
should be read within the context of the entire Article 39 of the TRIPS Agreement,
which reads:

Protection of Undisclosed Information

Article 39

1. In the course of ensuring effective protection

against unfair competition as provided in Article 10bis of
the Paris Convention (1967), Members shall protect
undisclosed information in accordance with paragraph 2
and data submitted to governments or governmental
agencies in accordance with paragraph 3 (Article 39.1)
2. Natural and legal persons shall have the
possibility of preventing information lawfully within their
control from being disclosed to, acquired by, or used by
others without their consent in a manner contrary to honest
commercial practices so long as such information:
 (a) is secret in the sense that it is not, as a body or in
the precise configuration and assembly of its components,
generally known among or readily accessible to persons
within the circles that normally deal with the kind of
information in question;
(b) has commercial value because it is secret; and
(c) has been subject to reasonable steps under the
circumstances, by the person lawfully in control of the
information, to keep it secret.
3. Members, when requiring, as a condition of
approving the marketing of pharmaceutical or of
agricultural chemical products shall utilize new chemical
entities, the submission of undisclosed tests or other data,
the origination of which involves a considerable effort,
shall protect such data against unfair commercial use. In
addition, Members shall protect such data against
disclosure, except where necessary to protect the public,
or unless steps are taken to ensure that the data are
protected against unfair commercial use.
17. The TRIPS Agreement is an international treaty administered by the
World Trade Organization (WTO) which sets down minimum standards for most
forms of intellectual property (IP) regulation within all member countries of the
WTO. It was negotiated at the end of the Uruguay Round of the General Agreement
on Tariffs and Trade (GATT) treaty in 1994. When the Philippines became a
member of the WTO, it had automatically acceded to the TRIPS Agreement. The
obligations under TRIPS apply equally to all member states.
18. Article 39.3 of the TRIPS Agreement is not a self-executing provision.
Instead, the article merely sets broad parameters upon which WTO member-states
should impose a regime of protection for “undisclosed information” submitted to the
government for marketing approval. This is emphasized in Article 1.1 of the TRIPS
Agreement which provides, to wit:
Members shall give effect to the provisions of this
Agreement. Members may, but shall not be obliged to,
implement in their law more extensive protection than is
required by this Agreement, provided that such protection
does not contravene the provisions of this Agreement.
Members shall be free to determine the appropriate
 method of implementing the provisions of this Agreement
within their own legal system and practice.
There is therefore a need for a legislative enactment on Article 39.3 to give it
effect in the Philippines.
19. At present, Article 39.3 of the TRIPS Agreement does not have a mirror
or counterpart provision under any Philippine law or statute. In any event, the
Philippines, together with a number of countries, has already publicly rejected the
interpretation that Article 39.3 of the TRIPS Agreement requires granting of
“exclusive rights” or “data exclusivity” to the owner of the data (“Protection of Data
for the Registration of Pharmaceuticals: Implementing the Standards of the TRIPS
Agreement, Carlos Maria Correa, University, p.52 [footnote # 35]). Some countries,
nevertheless, have gone beyond what is mandated by Article 39 (particularly Article
39.3) of the TRIPS Agreement as they enacted national laws providing for “data
exclusivity” over a specified period of time. These countries, however, have granted
such “data exclusivity” as a consequence of bilateral or regional free trade
negotiations, bilateral investment agreements and/or other international agreements
and treaties (Briefing Note on Access to Medicines, World Health Organization,
Western Pacific Region, pp. 2-3 on the sub-topic: “TRIPS Does Not Require Data
Exclusivity).
20. Inasmuch as Pfizer insists that it acquires rights from Article 39.3 of the
TRIPS Agreement, and MGT believes that it does not, there is a need for this
Honorable Court to declare that Pfizer cannot sue MGT or Hizon on the basis of
Article 39.3 of the TRIPS Agreement.
21. Assuming, without conceding, that Article 39.3 is self-executory, MGT
submits that it does not provide for “data exclusivity” but is more concerned with
assuring that “undisclosed data is protected from unfair commercial use.”
22. As may be culled from the exchanges between petitioner MGT and
Pfizer, there is clear disagreement on the scope Article 39.3 of the TRIPS
Agreement. Pfizer considers Article 39.3 as catering to “data exclusivity” over a
certain period. On the other hand, MGT believes that Article 39.3 simply suggests a
form of data protection which is intended to prevent unfair commercial use of data
by third parties. While Pfizer maintains that it has “market exclusivity” for
“Olmesartan Medoxomil” pursuant to Article 39.3 of the TRIPS Agreement, MGT
thinks that the same provision does not give Pfizer exclusivity over any publicly
available data submitted to the BFAD. At most, Pfizer’s rights under Article 39.3
are limited to protection of undisclosed data, or data that is not publicly available,
from unfair commercial use. MGT did not use undisclosed or confidential data;
much so, it did not resort to any form of unfair competition.
23. In order to determine the rights of the parties under Article 39.3 of the
TRIPS Agreement, there is a pressing need to construe its scope and meaning.
Particularly, MGT submits that this Honorable Court should declare that Article
39.3 of the TRIPS Agreement does not grant “data exclusivity” or “market
exclusivity” over test data submitted to the BFAD for marketing approval.
24. The TRIPS Agreement, under Article 39.3, establishes a minimum
standard for the protection of undisclosed data submitted for marketing approval.
This does not mean, however, that such protection requires the grant of exclusive
rights to the originator of the data. The value of undisclosed information is not
premised on inventive step or novelty; but, it is premised on the fact that undisclosed
information has commercial value and on its “confidentiality.” Unlike patents,
protection of undisclosed information under Article 39.3 does not amount to a
conferment of property rights.
25. The Vienna Convention on the Law of the Treaties, to which the
Philippines is a party, provides guidance on how to properly interpret Article 39.3
of the TRIPS Agreement. It instructs that the ordinary meaning and context of the
terms used, and the object and purpose of the treaty must be carefully considered.
Also, it states that the history of the negotiation is also an important complementary
element for interpretation (Article 31 (2), Vienna Convention).
26. The wording, context and purpose of Article 39.3 does not support an
interpretation that the required protection refers to “exclusivity” protection. First,
there is no categorical mention of “data exclusivity” in the subject article. Second, a
cursory reading of Article 39.3’s provision reveals the following:
(a) It requires governments to provide protection to marketing approval
data only under certain conditions.
(b) Test data must be protected if national authorities require its
submission.
(c) It does not require that protection be given to public data submitted for
marketing approval. To qualify for protection under Aticle 39.3, the pertinent
information must be “undisclosed.” This means that information that is already
within the public domain does not fall within the scope of the article.
(d) Protection is required only for new chemical entities. Article 39.3
would not apply in cases where approval is sought for new indications, dosage
forms, combinations, new forms of administration, crystalline forms, isomers, etc.
of existing drugs, since there would be no novel chemical entity involved.
(e) Article 39.3 requires countries to protect against “unfair commercial
use” of marketing approval data. Instances of “unfair commercial use” are: (a) a
competitor obtains the results of testing data through fraud, breach of confidence or
other dishonest practices and uses them to submit an application for marketing
approval for its own benefit; (b) the government provides access to undisclosed
testing data in order to provide an advantage to a firm which did not produce them
or share their cost. Protection from “unfair commercial use” is not “data
exclusivity.” Data exclusivity creates a form of property right; it presupposes
unconditional protection of test data over a period of time. In data exclusivity, data
remains exclusive in favor of its originator regardless of the nature and manner of
use, or whether there is “unfair commercial use” or not.
27. Further, the negotiating history of Article 39.3 reveals that the parties
considered at length, but did not adopt, text which required exclusivity for test data.
European, Japanese and United States business communities advocated for the
establishment of a data exclusivity regime. This was also the submission of the
United States representative to the TRIPS Agreement negotiations. Nonetheless,
these concepts were rejected (See “Protection of Data Submitted for the Registration
of Pharmaceuticals: Implementing the Standards of the TRIPS Agreement,” Carlos
Maria Correa, University of Buenos Aires).
28. MGT maintains that it did not violate any of Pfizer’s rights under
Article 39.3 of the TRIPS Agreement. However, in view of Pfizer’s position that
MGT did so, MGT invites this Honorable Court to also rule that, under the given
factual circumstances, MGT did not violate any of Pfizer’s rights, if any, under
Article 39.3 of the TRIPS Agreement.

29. MGT generated its own test data for its olmesartan medoxomil product.
It also used data that is available in the public domain. There was sufficient data on
olmesartan medoxomil that is publicly available. For instance, the website of the
Center for Drug Evaluation Research and the U.S. Food and Drug Administration
contains a wealth of information on olmesartan medoxomil
(http://www.fda.gov/cder/foi/nda/2002/21-286_Benicar.htm). A comprehensive
paper entitled “Olmesartan Medoxomil, a Novel Potent Angiotensin II blocker” is
downloadable from the internet.
PRAYER
 WHEREFORE, petitioner MGT Philippines, Inc. respectfully prays that this
Honorable Court, by way of declaratory relief, issue a Decision ruling that:
(a) Article 39.3 of the TRIPS Agreement is not a self-executing
provision upon which Pfizer could sue MGT and Hizon;
(b) Article 39.3 of the TRIPS Agreement does not mandate the grant
of “data exclusivity” or “market exclusivity” over test data submitted to the
BFAD for marketing approval; and
(c) MGT did not violate any of Pfizer’s rights under Article 39.3 of
the TRIPS Agreement.
Other reliefs just and equitable under the circumstances are likewise prayed
for. Respectfully submitted on _______________, Davao City.