Judgment of the Court (Fifth Chamber) of 16 April 1991. - Upjohn Company and Upjohn NV v Farzoo Inc. and J. Kortmann. - Reference for a preliminary ruling: Hoge Raad - Netherlands. - Concepts of "medicinal product" and "cosmetic product". - Case C-112/89.



European Court reports 1991 Page I-01703



Summary

Parties

Grounds

Decision on costs

Operative part



Keywords

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1. Approximation of laws - Proprietary medicinal products - Definition of medicinal product by Directive 65/65 - Classification as medicinal of a product not intended to cure or prevent disease - Conditions - Criteria

(Council Directive 65/65, Art. 1(2) )

2. Approximation of laws - Proprietary medicinal products - Product meeting both the definition of medical product in Directive 65/65 and that of cosmetic product in Directive 76/768 - Subject to the rules of Directive 65/65

(Council Directives 65/65, Art. 1(2), and 76/768, Art. 1(1) )

Summary

1. A product which is not "for treating or preventing disease in human beings or animals" within the meaning of the first subparagraph of Article 1(2) of Directive 65/65 relating to proprietary medicinal products is none the less a medicinal product if it may be administered "with a view to ... restoring, correcting or modifying physiological functions" within the meaning of the second subparagraph of that provision. That phrase must be given a sufficiently broad interpretation to cover all substances capable of having an effect on the actual functioning of the body and include not only products which have a real effect on physiological functions but also those which do not have the advertised effect, the marketing of which may thus be prohibited in order to protect consumers. It cannot, however, encompass substances such as certain cosmetics which, while having an effect on the human body, do not significantly affect the metabolism and thus do not strictly modify the way in which it functions.

It is for the national courts to determine on a case-by-case basis the classification of each product having regard to its pharmacological properties as they may be ascertained in the current state of scientific knowledge, to the way in which it is used, to the extent to which it is sold and to consumers' familiarity with it.

2. Even though it may fall within the definition of cosmetic products given in Article 1(1) of Directive 76/768, a product must nevertheless be treated as a medicinal product as referred to in Article 1(2) of Directive 65/65 relating to proprietary medicinal products and, if it is a proprietary medicinal product, subjected to the corresponding rules, to the exclusion of those governing cosmetic products, if it is presented for treating or preventing disease or if it is intended to be administered with a view to restoring, correcting or modifying physiological functions.

Such a classification is a necessary consequence of the aim, pursued by both directives, of protecting public health, since the rules governing proprietary medicinal products are stricter than those governing cosmetic products, in view of the particular risks to public health which the former may represent and which are generally not displayed by cosmetic products.

Parties

In Case C-112/89,

REFERENCE to the Court under Article 177 of the EEC Treaty by the Hoge Raad der Nederlanden (Supreme Court of the Netherlands) for a preliminary ruling in the proceedings pending before that court between

The Upjohn Company and Upjohn NV

and

Farzoo Inc. and J.A.W.M.J. Kortmann,

on the interpretation of the concept of "medicinal product" within the meaning of Council Directive 65/65/EEC of 26 January 1965 on the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products (Official Journal, English Special Edition 1965-1966, p. 20) and the concept of "cosmetic product" within the meaning of Council Directive 76/768/EEC of 27 July 1976 on the approximation of the laws of the Member States relating to cosmetic products (Official Journal 1976 L 262, p. 169),

THE COURT (Fifth Chamber),

composed of: J.C. Moitinho de Almeida, President of the Chamber, G.C. Rodríguez Iglesias, Sir Gordon Slynn, F. Grévisse and M. Zuleeg, Judges,

Advocate General: C.O. Lenz,

Registrar: J.A. Pompe, Deputy Registrar,

after considering the written observations submitted on behalf of

The Upjohn Company and Upjohn NV, by C.J.J.C. van Nispen, of the Hague Bar,

Farzoo Inc. and J.A.W.M.J. Kortmann, by I.G.F. Cath and M.J. Geus, of the Hague Bar,

the Spanish Government, by J. Conde de Saro, Director-General for Community Legal and Institutional Co-ordination, and R. Silva de Lapuerta, Abogado del Estado, of the Community Legal Affairs Department, acting as Agents,

the French Government, by E. Belliard, Deputy Director of the Legal Affairs Directorate in the Ministry of Foreign Affairs, and S. Grassi, Secretary for Foreign Affairs in the said ministry, acting as Agents,

the Italian Government, by O. Fiumara, Avvocato dello Stato, acting as Agent,

the United Kingdom, by J.A. Gensmantel, of the Treasury Solicitor' s Department, acting as Agent, assisted by J.G. McK. Laws, Barrister, and

the Commission of the European Communities, by R. Barents, a member of its Legal Department, acting as Agent,

having regard to the Report for the Hearing,

after hearing oral argument from The Upjohn Company and Upjohn NV, from Farzoo Inc. and J.A.W.M.J. Kortmann, represented by I.G.F. Cath, from the Spanish Government, represented by R. Silva de Lapuerta, from the Italian Government, from the United Kingdom, represented by D. Wyatt, Barrister, and from the Commission at the hearing on 15 January 1991,

after hearing the Opinion of the Advocate General delivered at the sitting on 19 February 1991,

gives the following

Judgment

Grounds

1 By judgment dated 31 March 1989, which was received at the Court on 6 April 1989, the Hoge Raad der Nederlanden referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty two questions on the interpretation of Council Directive 65/65/EEC of 26 January 1965 on the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products (Official Journal, English Special Edition 1965-1966, p. 20) and Council Directive 76/768/EEC of 27 July 1976 on the approximation of the laws of the Member States relating to cosmetic products (Official Journal 1976 L 262, p. 169), with a view to obtaining a more precise definition of the concept of "medicinal product" in Community law and of its delimitation from the concept of "cosmetic product".

2 Those questions arose in proceedings between The Upjohn Company and Upjohn NV (hereinafter referred to jointly as "Upjohn") on the one hand and Farzoo Inc. and Mr Kortmann (hereinafter referred to jointly as "Farzoo") on the other. Upjohn claims that Farzoo markets a product, "Minoxidil", in the Netherlands as a cosmetic product contrary to the Netherlands Wet op de Geneesmiddelenvoorziening (Law on the supply of medicinal products).

3 Minoxidil was developed in Upjohn' s laboratories in the early 1960s as a medicinal product for the treatment of arterial hypertension. One of its secondary effects was to encourage the growth of body hair, so Upjohn developed a second application of the product as a treatment for natural baldness. It markets the new product under the name "Regaine" as a medicinal product. It is common ground that "Regaine" is authorized or registered as a proprietary medicinal product in many countries, including eleven Member States of the European Communities, one of which is the Netherlands.

4 The product marketed by Farzoo, inter alia the Netherlands, under the name of "Minoxidil" is identical, as to purpose and use, to "Regaine". However, Farzoo regards its product as a cosmetic product and sells it as such.

5 Upjohn considered that Farzoo was competing unfairly with it by infringing both the Netherlands and the Community rules on the marketing of medicinal products and brought an action against Farzoo before the Arrondissementsrechtbank (District Court), 's-Hertogenbosch, seeking an order restraining Farzoo from marketing "Minoxidil" in any manner and requiring it to inform Upjohn of the names and addresses of its suppliers of "Minoxidil" and of any persons to whom it had already sold or delivered the product.

6 By judgment of 19 May 1987, confirmed on appeal by the Gerechtshof (Regional Court of Appeal), 's-Hertogenbosch, by judgment of 18 January 1988, the President of the Arrondissementsrechtbank dismissed the application.

7 Upjohn thereupon appealed to the Hoge Raad der Nederlanden for that judgment to be set aside. The Hoge Raad considered that the Netherlands Law on the supply of medicinal products should be interpreted consistently with the objectives of Directive 65/65 and that the case raised questions of the interpretation of the provisions of both that directive and Directive 76/768 relating to cosmetic products and sought a preliminary ruling from the Court of Justice on the following two questions:

(2) If so, how is the concept of "medicinal product" in Directive 65/65/EEC to be delimited from that of "cosmetic product" in Directive 76/768/EEC?"

8 Reference is made to the Report for the Hearing for a fuller account of the facts, the procedure and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.

Question 1

9 It is apparent from the order for reference and from the documents in the case that the Hoge Raad' s questions concern the scope of the second subparagraph of Article 1(2) of Directive 65/65, in view of the reasoning of the appeal court. The appeal court considered that male, or "natural", baldness (alopecia androgenetica) was not a "disease". It also noted that it was not even claimed that minoxidil had any effect whatever in the treatment of other, that is to say pathological, forms of baldness and concluded that the product could be neither regarded as intended to combat disease nor, therefore, classified as a "medicinal product".

10 The question is, therefore, essentially whether a product may be classified as "medicinal" even though it is not intended to cure or prevent any disease, merely because it may be administered with a view to restoring, correcting or modifying physiological functions.

11 The first subparagraph of Article 1(2) of Directive 65/65 defines a medicinal product as "any substance or combination of substances presented for treating or preventing disease in human beings or animals" and the second subparagraph provides that "any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in human beings or in animals" is likewise to be considered a medicinal product.

12 In the view of Upjohn, the Commission, the Spanish, French and Italian Governments and the United Kingdom, the Hoge Raad' s first question should be answered in the affirmative. Because of the difference in the aims pursued, the expression used in the second subparagraph of Article 1(2) has a meaning which is both different from and broader than that of the expression used in the first subparagraph.

13 While the first criterion, based on the presentation of the product, is intended as a safeguard against quackery, the second makes it possible to catch all substances which may have an effect on human health.

14 Farzoo claims that, on the contrary, a medicinal product can be defined only in relation to the concept of "disease", and that the expression "restoring, correcting or modifying physiological functions" is therefore incapable of meaning anything other than "treating or preventing" disease.

15 That view cannot be accepted. Directive 65/65 provides two definitions of the term "medicinal product": one relating to presentation, the other to function. A product is medicinal if it falls within either of those definitions.

16 As the Court held in Case 227/82 van Bennekom [1983] ECR 3883, the "presentation" criterion used in the first subparagraph of Article 1(2) is designed to catch not only medicinal products having a genuine therapeutic or medical effect but also those which are not sufficiently effective or which do not have the effect which their presentation might lead to expect, in order to preserve consumers not only from harmful or toxic medicinal products as such but also from a variety of products used instead of the proper remedies. The concept of the "presentation" of a product must therefore be broadly construed.

17 The second definition, however, refers to the function of medicinal products; it covers all products which are intended to restore, correct or modify physiological functions and which may thus have an effect on health in general.

18 Those two definitions cannot, however, be viewed as rigorously distinct. As the Court stated in paragraph 22 of its judgment in van Bennekom, a substance which is endowed with properties "for treating or preventing disease in human beings or animals" within the meaning of the first part of the Community definition, but which is not presented as such, falls within the scope of the second part of the Community definition of a medicinal product.

19 But products which alter physiological functions in the absence of disease, such as contraceptive substances, also fall within the scope of that definition.

20 Furthermore, the fact that the provision uses the expression "with a view to" means that the definition of a medicinal product may include not only products which have a real effect on physiological functions but also those which do not have the advertised effect, thereby enabling public authorities to prevent the marketing of such products in order to protect consumers.

21 As regards the meaning of "restoring, correcting or modifying physiological functions", it is clear from the aim of health protection pursued by the Community legislature that the phrase must be given a sufficiently broad interpretation to cover all substances capable of having an effect on the actual functioning of the body.

22 However, that criterion does not serve to include substances such as certain cosmetics which, while having an effect on the human body, do not significantly affect the metabolism and thus do not strictly modify the way in which it functions.

23 It is for the national courts to determine on a case-by-case basis the classification of each product having regard to its pharmacological properties as they may be ascertained in the current state of scientific knowledge, to the way in which it is used, to the extent to which it is sold and to consumers' familiarity with it.

24 The answer to the national court' s first question must therefore be that a product which is not "for treating or preventing disease in human beings or animals" is a medicinal product if it may be administered "with a view to ... restoring, correcting or modifying physiological functions", and it is for the national courts to determine on a case-by-case basis the classification of each product having regard to its pharmacological properties as they may be ascertained in the current state of scientific knowledge, to the way in which it is used, to the extent to which it is sold and to consumers' familiarity with it.

Question 2

25 By its second question, the Hoge Raad der Nederlanden seeks to ascertain how the dividing line between medicinal products and cosmetic products is to be drawn as regards products which are not for treating or preventing disease.

26 Upjohn, the Commission, the Spanish Government and the United Kingdom maintain that a product cannot be classified as a "cosmetic product" if it is covered by the definition of a medicinal product and that only the stricter legal rules governing medicinal products are applicable, in conformity with the objective of protecting public health. In the specific case with which the main proceedings are concerned, the French Government observes that cosmetic products may not contain minoxidil, since Commission Directive 87/137/EEC of 2 February 1987 adapting to technical progress Annexes II, III, IV, V and VI to Council Directive 76/768/EEC (Official Journal 1987 L 56, p. 20) has prohibited the use of minoxidil and its salts and derivatives in cosmetic products. The Italian Government considers that a cosmetic product may have the effect of modifying certain physiological functions if envisaged in Directive 76/768, provided that any modification is unconnected with any pathological condition.

27 In Farzoo' s submission, a product such as "Minoxidil" falls within the definition of a cosmetic product given in Article 1(1) of Directive 76/768, and is not excluded from the scope of the directive pursuant to the principles set out in the fifth recital in its preamble provided that it is not exclusively intended to protect from disease or intended to be ingested, inhaled, injected or implanted in the human body.

28 Article 1(1) of Directive 76/768 defines a cosmetic product as "any substance or preparation intended for placing in contact with the various external parts of the human body (epidermis, hair system, nails, lips and external genital organs) or with the teeth and mucous membranes of the oral cavity with a view exclusively or principally to cleaning them, perfuming them or protecting them in order to keep them in good condition, change their appearance or correct body odours".

29 As stated in the fifth recital, which specifies that the directive "relates only to cosmetic products and not to pharmaceutical specialities and medicinal products", the rules laid down by Directive 76/768 concern only cosmetic products and not medicinal products.

30 Consequently, while a comparison between the definitions of a cosmetic product and a medicinal product is not to be ruled out in doubtful cases before a product is classified functionally as a medicinal product, a product which has the characteristics of a medicinal product or a proprietary medicinal product still does not fall within the scope of Directive 76/768; it is subject only to the provisions of Directive 65/65 and the directives amending it.

31 That is, moreover, the only conclusion consistent with the aim, pursued by both directives, of protecting public health, since the legal rules governing proprietary medicinal products are stricter than those governing cosmetic products, in view of the particular risks to public health which the former may represent and which are generally not displayed by cosmetic products.

32 Consequently, even though it may fall within the definition in Article 1(1) of Directive 76/768, a product must nevertheless be treated as a "medicinal product" and subjected to the relevant rules if it is presented for treating or preventing disease or if it is intended to be administered with a view to restoring, correcting or modifying physiological functions.

33 The answer to the national court' s second question must therefore be that any product satisfying either of the sets of criteria laid down in Article 1(2) of Directive 65/65 is a medicinal product and must, if it is a proprietary medicinal product, be subject to the corresponding legal rules, to the exclusion of those governing cosmetic products.

Decision on costs

Costs

34 The costs incurred by the Spanish, French and Italian Governments, the United Kingdom and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. Since these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

Operative part

On those grounds,

THE COURT (Fifth Chamber),

in answer to the questions referred to it by the Hoge Raad der Nederlanden by judgment of 31 March 1989, hereby rules:

1. A product which is not "for treating or preventing disease in human beings or animals" is a medicinal product if it may be administered "with a view to ... restoring, correcting or modifying physiological functions", and it is for the national courts to determine on a case-by-case basis the classification of each product having regard to its pharmacological properties as they may be ascertained in the current state of scientific knowledge, to the way in which it is used, to the extent to which it is sold and to consumers' familiarity with it;

2. Any product satisfying either of the sets of criteria laid down in Article 1(2) of Council Directive 65/65/EEC of 26 January 1965 on the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products is a medicinal product and must, if it is a proprietary medicinal product, be subject to the corresponding legal rules, to the exclusion of those governing cosmetic products.