OUTLINE AND BIBLIOGRAPHY

CHARLES E. LYON

Page 2 of 3

“pharmaceutical trade dress – consumer protection or consumer confusion?”

Outline

The trade dress (size, shape and color) of branded prescription drugs products (Viagra, Prilosec, Nexium, etc.) is being used increasingly by big pharma to block competition from generics after patent expiration. Generics want to use the same trade dress as the branded drug and big pharma will do all it can to stop them. The recent case law in the US (and in Canada) has swayed between favoring the two extremes.

In Part 1, I will describe the basics of trade dress law in the US and then specific issues that have been raised in the context of prescription drug products (with some comparisons with the Canadian approach):

a. Trade dress law in general:

i. § 43(a) of Lanham Act

ii. Product packaging v. Product design

iii. Functionality

iv. Secondary meaning

v. Likelihood of confusion

b. Trade dress law as applied to prescription drug products focusing on the 3rd Circuit (where most big pharmas have their HQs):

i. Product packaging v. Product design (is it even discussed by courts?)

ii. Functionality esp. in context of color – safety, compliance/acceptance of generics by public (i.e., break the deception/stigma)

iii. Secondary meaning – promotes advertising to public that pushes prices even higher?

iv. Likelihood of confusion – public as consumer vs. doctor/pharmacy

c. Comparison with Canadian law re: prescription drugs

In Part 2, I will comment on whether it is appropriate to give strong trade dress protection for prescription drugs. In particular I will note the following fundamental issues that (I think) suggest that they should not be treated like regular consumer products:

a. If trademarks are supposed to ensure that the consumer can associate a given product with quality (via a single source) then this assumes that the consumer can actually judge the quality of the trademarked product. I would argue that regular consumers cannot judge the “quality” of prescription drugs in the same way that they can judge the quality of a shoe. Consider the “placebo effect” or the fact that the public is prepared to pay twice as much for a brand drug even after the generic is on the market. A brand name’s ability to keep the trade dress of generics as different as possible simply perpetuates what I would argue is consumer deception and thus contrary to traditional trademark policy.

b. The FDA regulates generic drugs to ensure that they are equivalent to the branded drug, i.e., the two products are essentially the same. The situation is therefore different from one involving a new shoe company making a shoe that looks just like a Nike shoe from the outside but is (a) of lower quality or (b) different internally. In addition, the FDA is continuously monitoring for issues that would require the generic to be pulled. There is no such regulatory watchdog in the shoe industry.

c. When a consumer buys a drug he or she does not act alone. A doctor, a pharmacist and possibly an insurer are also involved and may actually make all of the decisions for the consumer. There are no such “external influences” in the shoe buying scenario. Also the consumer never actually sees the trade dress of the drug product before buying it at the pharmacy – isn’t this significant vs. shoes that are on display and optionally tried on before purchase?

d. The owners of brand drugs will typically hold a patent on the active ingredient that will exclude ALL competing products in the area for a considerable amount of time. In contrast, many consumer products are either not patented or patented in a way that does not create such a total monopoly in a given area. Thus, even if Nike acquired a patent on some new type of sole this would not remove ALL competition from the running shoe market. Generics on the other hand are up against a drug that had a 10-15 year monopoly in the competitive field.

Bibliography:

US Case Law

Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844 (1982)

Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992)

Qualitex Co. v. Jacobson Prods. Co., 514 U.S. 159 (1995)

Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. 205 (2000)

TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001)

Smith, Kline & French Laboratories v. Clark & Clark, 157 F.2d 725 (3d Cir.1946)

SK&F, Co. v. Premo Pharmaceutical Laboratories, Inc., 625 F.2d 1055 (3d Cir.1980)

American Home Prods. Corp. v. Chelsea Labs., Inc., 722 F.2d 730 (3d Cir.1983)

Ciba-Geigy Corp. v. Bolar Pharm. Co., 719 F.2d 56 (3d Cir.1983)

Ciba-Geigy Corp. v. Bolar Pharm. Co., 747 F.2d 844 (3d Cir.1984)

American Home Products Corp. v. Barr Laboratories, Inc., 834 F.2d 368 (3d Cir.1987)

Shire US Inc. v. Barr Laboratories, Inc., 329 F.3d 348, (3d Cir. 2003)

Foreign Case Law

Ciba-Geigy Canada Ltd. v. Novopharm Ltd., [1992] 3 S.C.R. 120 (CA)

Eli Lilly & Co. v. Novopharm Ltd., [2000] FCJ No 2090 (CA) (QL)

Secondary Sources

Darrel C. Karl, “Look-alike” Capsules, Generic Drug Substitution, and the Lanham Act: The Elusive Contributory Infringement Standard of Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 32 Cath. U.L. Rev. 345 (1982)

Karin S. Schwartz, “It Had to be Hue: The Meaning of Color ‘Pure and Simple’”, 6 Fordham Intell. Prop. Media & Ent. L.J. 59 (1995)

Laura R. Visintine, The Registrability of Color Per se as a Trademark After Qualitex Co. v. Jacobson Products Co., 40 St. Louis L.J. 611 (1996)

David B. Tongg, “The Qualitex Quandary: Was Trademark Protection for Color Per Se Clearly Resolved?,” 18 Hawaii L. Rev. 445 (1996)

Ronald E. Dimock, Intellectual Property Disputes: Resolution and Remedies, Chapter 7. Pharmaceuticals

Aaron M. Pile, What's in Your Bottle?: Shire US Inc. v. Barr Laboratories Inc. and Its Effect on Prescription Drug Trade Dress Protection in the Third Circuit, 8 PGH J. Tech. L. & Pol'y 2 (2004)

1 Food and Drug Admin. § 15:10 (2005) - James T. O'Reilly, Chapter 15. Drug Economic and Advertising Issues § 15:10. FDA and drug advertising: Overview and remedies