UK: Financial Pitfalls Associated With An Interim Injunction

Last Updated: 7 April 2014
Article by Stuart Forrest and Paul Howard

In AstraZeneca v KRKA, d.d. Novo Mesto and Consilient Health Ltd. ("KRKA"), the Mr Justice Sales of the UK High Court has considered the merits of arguments put forward when trying to recover damages following a cross-undertaking in respect of an interim injunction that was subsequently discharged.

Significantly, in awaiting damages in KRKA the Judge chose to rely on the evidence of medicine managers (experienced pharmacists employed by the National Health Service Primary Care Trusts) rather than that of expert economists when assessing the loss of "first mover" advantage.

Facts of the case

AstraZeneca owns a European (UK) patent that provides protection for Nexium®, which is the brand name for esomeprazole magnesium, a proton pump inhibitor that is used to treat a range of gastric conditions. Nexium® was launched in the UK in 2000 and was the only product of its kind on the market until 2011, during which period it commanded a high price.

In October 2010, AstraZeneca obtained an interim injunction in the UK that prevented KRKA from marketing Emozul®, a generic equivalent of Nexium®, in order to preserve the status quo pending a trial. KRKA claimed that Emozul® did not infringe AstraZeneca's patent.

At the time that AstraZeneca obtained its injunction against KRKA, the validity of AstraZeneca's patent for Nexium® was being challenged in the UK by Ranbaxy, who also sought to market a generic equivalent of Nexium® in the UK. A speedy trial concerning the issues of infringement found that Ranbaxy's product did not infringe AstraZeneca's patent.

Following the Ranbaxy judgment, AstraZeneca applied for the interim injunction against KRKA to be discharged because it recognised that its patent infringement claim could not succeed. The interim injunction against KRKA was finally discharged in July 2011.

Market activity

A number of generic equivalents of Nexium® were marketed in the UK following the Ranbaxy judgment: Ranbaxy marketed its equivalent in September 2011; Mylan in November 2011; and Teva in December 2011. AstraZeneca also teamed up with Arrow (another generics company) to sell a "branded generic" version of Nexium® in July 2011. The "branded generic" version was launched in the UK two days after the Ranbaxy judgment. AstraZeneca's market share for Nexium® fell following the arrival of several lower priced generic equivalents onto the marketplace.

Considerations for assessment of damages

In order to assess the damages payable by AstraZeneca under the cross-undertaking, the Court considered the commercial impact that the interim injunction had on KRKA by delaying its entry into the marketplace until after several other generic versions of Nexium® were available in the UK, referred to as the loss of "first mover" advantage. There was a significant divergence of opinion between AstraZeneca and KRKA as to the value of the loss of "first mover" advantage. AstraZeneca estimated the loss to be £6 million, whereas KRKA claimed it was £32 million.

There was universal agreement that the Court should apply the principles set out in Les Laboratoires Servier v Apotex Inc. [2008] EWHC 2347 when assessing damages and determining the loss that the injunction caused KRKA. Those principles are summarised as follows:

  1. The approach is essentially compensatory and not punitive.
  2. The assessment is made on the same basis on which damages for a breach of contract would be assessed.
  3. The court should attempt a principled approach, even if it may not be possible to calculate the defendant's losses with certainty or precision.
  4. The damages should be assessed on a particular hypothesis and then multiplied by the percentage chance of that hypothesis occurring.

The Court went on to clarify the approach in certain aspects, namely that:

  1. So-called "restitutionary" damages could be considered if a wrongful extension of patent term results in benefit to the patent holder that exceeds and outstrips the loss to the generic company.
  2. Damages are to be "liberally assessed". Although the party giving the cross undertaking of damages is not a wrongdoer, the approach to damages is the same as when considering damages against a wrongdoer.

In assessing damages, the Court needed to consider a complicated and highly regulated marketplace. The Court considered the premium price paid for patented drugs, where no generic equivalents are available, and the lower price paid for drugs when several alternative generic products are available. The Court also considered factors that influence switching patients to a new (less expensive) entrant into the marketplace.

In this case, KRKA argued that it would have been able to charge a higher price for Emozul® if it had benefitted from the "first mover" advantage in October 2010. KRKA also argued that it would have established and maintained some of its market share had it benefitted from the "first mover" advantage, because there would have been reluctance to switch patients to an alternative drug for a second time.

In response, AstraZeneca argued that it would have dropped the UK price for Nexium® following a loss of market share. However, if the price for Nexium® in the UK fell, then the prices in certain other European countries would also fall because the UK price for Nexium® was used as a reference point for the price payable in other countries.


The court was not persuaded that AstraZeneca would have reduced the UK price for Nexium®.

The Judge concluded that if KRKA had been able to launch Emozul® in the UK in October 2010, then there would have been a substantial switch of patients from Nexium® to Emozul®. However, as the launch of Emozul® was delayed until September 2011, Emozul® was competing with Nexium® and five other generic products. The opportunity to charge a higher price and establish market share for Emozul® had been lost, because a competitive environment had developed. The Judge invited the parties to agree on the damages payable.


This case serves as a reminder that interim injunctions can be costly. It also presents an interesting insight into the commercial approach that the UK Courts might take in pharmaceutical cases when assessing damages for a defendant who seeks to benefit from a cross undertaking following an interim injunction.

Need advice?

Carpmaels & Ransford LLP is a leading firm of European patent and trade mark attorneys based in London. For more information about our firm and our practice, please visit our website at

This Briefing Note was first published in the IAM IP Newsletter.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.