Opinion of the Advocate General — ECLI:EU:C:2022:27
Date: 2022-01-13
Language of the case: Dutch
Subject matter: Free movement of goods;Measures having equivalent effect;Quantitative restrictions
Procedure: Reference for a preliminary ruling
Origin: Belgium

Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged:  
9 June 2020 
Referring court:  
Hof van beroep Brussel (Belgium) 
Date of the decision to refer:  
25 May 2020 
Appellant:  
PI PHARMA NV 
Respondents:  
NOVARTIS AG  
NOVARTIS PHARMA NV 
  
Subject matter of the main proceedings 
Appeal brought by PI Pharma before the Hof van beroep Brussel (Court of 
Appeal, Brussels, Belgium) against the judgment of 12 April 2018 of the President 
of the Nederlandstalige rechtbank van koophandel Brussel (Brussels Commercial 
Court (Dutch-speaking), Belgium), hearing an application for interim relief, 
upholding the action brought by Novartis for infringement of its trade mark rights, 
and ordering, on pain of a financial penalty, the cessation of the trade mark 
infringement which PI Pharma was found to have committed within the meaning 
of Article 2.2[0].1.(a) of the Benelux Convention on Intellectual Property (BCIP) 
by importing Sandoz’s generic methylphenidate from the Netherlands into 
Belgium and affixing to it the Novartis Rilatine trade mark and then marketing it 
under that trade mark through wholesalers, pharmacists or other distribution 
channels.  
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-254/20 
 
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Subject matter and legal basis of the request for a preliminary ruling 
Interpretation, pursuant to Article 267 TFEU, of Articles 34 and 36 TFEU and of 
the ‘BMS’ conditions as developed in the judgments of the Court of Justice of 
11 July 1996, Bristol-Myers Squibb and Others (C-427/93, C-429/93 and 
C-436/93, EU:C:1996:282), and of 12 October 1999, Upjohn (C-379/97, 
EU:C:1999:494). 
Questions referred for a preliminary ruling 
1) Must Articles 34 to 36 TFEU be interpreted as meaning that, where a 
branded medicine (reference medicine) and a generic medicine have been put on 
the market in the EEA by economically linked undertakings, a trade mark 
proprietor’s opposition to the further commercialisation of the generic medicine 
by a parallel importer after the repackaging of that generic medicine by the 
affixing to it of the trade mark of the branded medicine (reference medicine) in the 
country of importation may lead to an artificial partitioning of the markets of the 
Member States?  
2) If the answer to that question is in the affirmative, must the trade mark 
proprietor’s opposition to that rebranding be assessed by reference to the BMS 
conditions? 
3) Is it relevant to the answer to those questions that the generic medicine and 
the branded medicine (reference medicine) are identical or have the same 
therapeutic effect as referred to in Article 3(2) of the Koninklijk besluit van 19 
april 2001 inzake parallelinvoer (Royal Decree of 19 April 2001 on parallel 
imports)?  
Provisions of EU legislation and Benelux legislation and case-law of the Court 
of Justice relied on 
Articles 34 and 36 TFEU 
Benelux-Verdrag inzake de intellectuele eigendom (BVIE) (Benelux Convention 
on Intellectual Property (BCIP)), Article 2.20.1.(a); Article 2.20.2; and 
Article 2.23.3, equivalent to Article 13 of Council Regulation (EC) No 207/2009 
of 26 February 2009 on the Community trade mark 
Judgments of the Court of Justice of 11 July 1996, Bristol-Myers Squibb and 
Others (C-427/93, C-429/93 and C-436/93, EU:C:1996:282), and of 12 October 
1999, Upjohn (C-379/97, EU:C:1999:494) 
PI PHARMA 
 
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Provisions of national law relied on 
Article 3(2) of the Koninklijk besluit van 19 april 2001 inzake parallelinvoer van 
geneesmiddelen voor menselijk gebruik en de parallelle distributie van 
geneesmiddelen voor menselijk en diergeneeskundig gebruik (Royal Decree of 
19 April 2001 on the parallel import of medicines for human use and parallel 
distribution of medicines for human and veterinary use (‘the Royal Decree of 
19 April 2001’): ‘… a person who wishes to import a medicine in parallel may 
obtain an authorisation to do so, provided that the medicine in question is one: (1) 
for which authorisation to put it on the market has been issued by the competent 
authorities in the Member State of origin; (2) for which a reference medicine 
exists; (3) which, while not being identical in all respects, in comparison to the 
reference medicine at least (a) has the same qualitative and quantitative 
composition as regards its active ingredients; (b) has the same therapeutic 
indications; (c) is therapeutically equivalent; (d) has the same pharmaceutical 
form.’  
Brief summary of the facts and procedure in the main proceedings 
1 Novartis AG is the Swiss parent company of the Novartis Group, to which the 
Novartis Division (sale of patented branded medicines) and the Sandoz Division 
(sale of generic medicines) belong. In Belgium, its subsidiary, Novartis Pharma 
NV (together: ‘Novartis’), puts the original branded medicines on the market.  
2 Novartis has developed a prescription medicine containing the active ingredient 
methylphenidate for the treatment of attention deficit disorder combined with 
hyperactivity (ADHD) and for the treatment of narcolepsy. That medicine is 
commercialised under the trade mark Ritalin, Ritaline, Ritalina or Rilatine. The 
Rilatine at issue in the present case is a Benelux word mark (No 0054047) of 
which Novartis Pharma NV has been the proprietor since 1973. The branded 
medicine Rilatine is put on the market in Belgium (inter alia in packs of 20 tablets 
of 10 mg under the authorisation VHB — No BE051597) by Novartis Pharma NV 
and in the Netherlands (inter alia in packs of 30 tablets of 10 mg under marketing 
authorisation number RVG 03957) by Novartis Pharma BV. 
3 Since methylphenidate is no longer patent-protected, Sandoz BV puts the generic 
medicine Methylphenidate HCI Sandoz 10 mg on the market in the Netherlands in 
packs of 30 tablets. Sandoz BV does so by virtue of marketing authorisation 
number RVG 27033= 09357, with the equal sign indicating that the medicine 
Methylphenidate HCI Sandoz 10 mg tablet is identical to the medicine Ritalin 10 
mg tablet. Sandoz BV does not market the medicine Methylphenidate HCI Sandoz 
in Belgium.  
4 PI Pharma is a Belgian undertaking engaged in the parallel import of medicines. It 
imports the medicine Methylphenidate HCI Sandoz 10 mg from the Netherlands 
into Belgium after (1) repackaging (new outer packaging of 20 tablets) and (2) 
rebranding (with the Rilatine trade mark). For Rilatine 10 mg tablets, PI Pharma 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-254/20 
 
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obtained a Belgian authorisation for parallel import No 1637 PI 0322 F003 on 
10 September 2014, with Rilatine 10 mg tablets as reference medicine.  
5 By letter of 30 June 2015, PI Pharma notified Novartis Pharma NV that it had 
obtained authorisation to put on the market in Belgium the medicine Rilatine 10 
mg x 20 tablets, imported from the Netherlands (Methylphenidate Sandoz 10 mg), 
and that it would enter the Belgian market with the medicine. 
6 By letter of 22 July 2015, Novartis opposed the planned parallel import on the 
ground that its trade mark rights in respect of Rilatine had not been exhausted, so 
that the rebranding of the imported generic medicine as Novartis’s original 
medicine manifestly infringed its trade mark rights and amounted to misleading 
the public.  
7 PI Pharma proceeded with the commercialisation of the repackaged and rebranded 
medicine in Belgium in October 2016.  
8 The respective Belgian and Netherlands markets for medicines with the active 
ingredient Methylphenidate have the following characteristics:  
– Prices: Due to the fact that PI Pharma applied to the Rijksinstituut voor ziekte- 
en invaliditeitsverzekering (National Institute for Health and Disability 
Insurance) for reimbursements in respect of the medicines it sells, where 
reimbursement is subject to prior authorisation, the retail price for Rilatine 10 
mg x 20 tablets Novartis is EUR 8.10 (or EUR 0.405 per tablet), whereas the 
retail price for Rilatine 10 mg x 20 tablets PI Pharma is EUR 7.95 (or 
EUR 0.398 [per tablet]). The retail price of Methylphenidate HCI Sandoz 10 
mg in the Netherlands is EUR 0.055 per tablet. 
– Market share: In Belgium, in the period 2015-2018, Rilatine’s market share for 
Novartis decreased from 94% to 71%, whereas PI Pharma’s market share rose 
from 0% to 18% over the same period. In the Netherlands, in the period 2015-
2018, the market share for Ritalin (Novartis) decreased from 6% to 4%, while 
the market share for Methylphenidate HCI Sandoz (Sandoz) decreased from 
30% to 26% over the same period. 
Main submissions of the parties to the main proceedings 
– Regarding the exhaustion of the trade mark rights of Novartis: 
9 Novartis submits that, under Article 2.23.3 BCIP, trade mark rights are only 
exhausted in relation to goods which have been put on the market in the EEA 
‘under that trade mark’ by the proprietor or with the proprietor’s consent.  
10 In the present case, the medicines imported in parallel in Belgium were put on the 
market in the Netherlands by Sandoz BV under the International Non-proprietary 
Name (INN) ‘Methylphenidate HCI’, followed by the Sandoz trade mark. Those 
PI PHARMA 
 
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individual products were not put on the market under the trade mark ‘Rilatine’ (or 
‘Ritalin’) by Novartis or an economically linked undertaking such as Sandoz BV. 
Article 2.23.3 BCIP does not apply in the case of a rebranding, that is to say, 
where PI Pharma imports medicines into Belgium which were put on the market 
in the Netherlands as ‘Methylphenidate HCI Sandoz’, and for the first time affixes 
to those medicines a sign identical to another trade mark (Rilatine). The rights 
which Novartis derives from its Benelux trade mark Rilatine are not exhausted for 
the purposes of Article 2.23.[3] BCIP.  
11 PI Pharma contends that that statement does not make any difference. The trade 
mark rights of Novartis in the event of the rebranding of a medicine must be 
assessed on the basis of Articles 34 and 36 TFEU and on the basis of the BMS 
conditions concerning trade mark exhaustion in the case of repackaging of parallel 
imported medicines. One of those conditions, under which the trade mark 
proprietor cannot prohibit a parallel importer from putting a product on the market 
after repackaging and under the trade mark, is that it has been established that the 
trade mark proprietor is using its trade mark right to artificially partition markets, 
in particular where repackaging is necessary in order to put the product on the 
market in the Member State of importation. The opposition of the trade mark 
proprietor to rebranding by a parallel importer where rebranding is necessary in 
order to sell the products in the Member State of importation constitutes a barrier 
to trade between Member States which leads to an artificial partitioning of the 
markets of the Member States.  
12 According to PI Pharma, that case-law should also be applied to the rebranding of 
a generic medicine as a branded medicine where both have been placed on the 
market in the EEA by economically linked undertakings. Moreover, the medicine 
Methylphenidate HCI Sandoz 10 mg is not a genuine generic medicine but rather, 
according to PI Pharma, ‘an authentic medicine with a generic name’, which is 
identical to the branded medicine Rilatine or Ritalin. [That is apparent from a 
comparison of the composition and the fact that the imported Methylphenidate 
HCI Sandoz 10 mg was authorised under the derived registration procedure (and 
not by an appropriate authorisation procedure for generic medicines)]. 
– Regarding the artificial partitioning of markets: 
13 Novartis submits that there is no question of artificial partitioning of the markets 
because generic medicines and branded medicines are different products that 
operate in different market segments. They are distinct from a regulatory point of 
view (requirement of separate market authorisations and different names), from a 
medical point of view (substitution by the pharmacist is prohibited in Belgium), 
from the point of view of the pricing and reimbursement policy, and in terms of 
public perception. Since branded medicines and generic medicines are sold in 
different markets, prohibiting a parallel importer from rebranding a generic 
medicine as a branded medicine cannot be said to partition the market. The 
principle of the free movement of goods cannot be invoked to permit rebranding; 
assessment against the BMS conditions is not at issue and the identical 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING — CASE C-254/20 
 
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composition of the medicines and the fact that they are placed on the market by 
economically linked undertakings is irrelevant.  
14 PI Pharma argues that the question whether the markets have been artificially 
partitioned should not be assessed on the basis of product markets (as Novartis 
does) but on the basis of the territorial markets of the EEA Member States. If there 
is no possibility of normal parallel trade between the Member States, then there is 
an artificial partitioning of the (territorial) markets. There is, in fact, but a single 
pharmaceutical market, driven by the prescribing practices of doctors (using their 
therapeutic freedom). Once patent protection for the active ingredient has been 
lifted, there are fully fledged alternatives that are interchangeable, and that 
interchangeability is not affected by the other distinctions cited by Novartis. The 
only relevant criterion when examining interchangeability of medicines is 
therapeutic efficacy, which is assessed in practice by the prescribing doctor. 
Irrespective of whether the product is a branded medicine or a generic medicine, 
when a trade mark proprietor starts to use different brand names for the same 
product in the EEA, a parallel trader is entitled to rebrand if the BMS conditions 
are fulfilled. Furthermore, the imported medicine does not have to be 100% 
identical to the Belgian reference medicine (pursuant to Article 3(2) of the Royal 
Decree of 19 April 2001). Moreover, the medicines at issue in the present case are 
identical (Methylphenidate HCI Sandoz is identical to Rilatine), despite the fact 
that Novartis presents Methylphenidate HCI Sandoz as a generic medicine.  
Brief summary of the reasons for the reference for a preliminary ruling 
15 The Brussels Court of Appeal finds that there is controversy and uncertainty as to 
whether the trade mark proprietor’s opposition to the further commercialisation of 
a generic medicine by a parallel importer who has repackaged that generic 
medicine in the country of importation by affixing to it the trade mark of the 
branded medicine (the reference medicine) is liable to lead to an artificial 
partitioning of the markets of the Member States for the purposes of Articles 34 
and 36 TFEU.  
16 Various court cases are pending in Belgium in which trade mark proprietors and 
parallel importers disagree on this question. The question is answered in different 
ways by the courts.  
17 Those disputes are characterised by the fact that they all concern the rebranding of 
a generic medicine as a branded medicine by a parallel importer, where both 
medicines have been put on the market in the EEA by economically linked 
undertakings.