Repackaging of Pharmaceuticals

Single market integration within the EC has induced notable growth in parallel importation in general, but with the further harmonisation of the internal market, the potential profit in such activity declines. This trend for declining profits has not been the case with pharmaceuticals however, as pricing decisions are constrained by the varying mandatory rules presented by national public authorities. Consequently, pharmaceuticals remain subject to continuous parallel intra-Community importation.It is no wonder then, that during recent years pharmaceutical producers have often contested the means and the extent of parallel importation in court. Most often, the claim has been that of a trademark infringement, as the importers tend to repackage the goods prior to introducing them to a new market. According to the First Council Directive 89/104/EEC relating to trademark law (Trademark Directive), the exclusive right conferred by the trademark entitles the proprietor to prevent all third parties from using the trademark in the course of trade without his consent. Accordingly, repackaged products that have a trademark affixed on the package typically constitute a breach of this fundamental proprietary right.