Medicines Regulator’s Inspection of Roche was lawful, says Court of Appeal

21 Dec 2015

In a judgment released today, the Court of Appeal held that the UK Medicines and Healthcare Regulatory Agency had acted lawfully in carrying out inspections of Roche in late 2013 and in communicating material from that inspection to the European Medicines Agency.

On a previous inspection in 2012, critical deficiencies had been found in Roche’s pharmacovigilance system (pharmacovigilance is the obligation on a pharmaceutical company to monitor and pass on to the authorities reports of adverse reactions to, and lack of therapeutic effect of, its medicines).  The European Commission had then asked the EMA to consider action against Roche under the EU Penalties Regulation – action that could result in a large fine against Roche.

The 2013 inspections were carried out under the general MHRA’s powers to inspect: such inspections are routine in cases where critical deficiencies have previously been identified in order to ensure that the deficiencies have been corrected.  Roche’s claim that the MHRA had not acted lawfully centred on the fact that the EMA had, before the inspections, made a request under Article 8(3) of the Penalties Regulation for information derived from the inspections to be passed to the EMA.  Roche claimed that in the circumstances the MHRA had acted unfairly.  Roche also sought a reference for a preliminary ruling from the Court of Justice of the EU on (a) whether the EMA had power to make such a request of the MHRA under Article 8(3) and (b) whether the MHRA was right to take the view, in its reports to the EMA, that the Roche company being inspected was responsible under the Penalties Regulation for pharmacovigilance deficiencies by another group company.

The Court of Appeal rejected its claim of unfairness and refused a reference.  On the question of unfairness, Sales LJ (giving the lead judgment) agreed with the trial judge (Carr J) that there was no unfairness.  The Court agreed with the MHRA’s submissions that the legislative framework clearly contemplated that information from routine inspections could be passed to the EMA and used in for the purposes of the Penalties Regulation.  The Court also agreed with the MHRA that it “rather strained credulity” that Roche’s experienced representatives during the inspections were “ingénus” who could not be taken to have understood that that was likely to happen.  In her concurring judgment, Arden LJ noted that where the EU legislator had created a regime such as the Penalties Regulation, with a number of procedural protections, the English court should be slow to find a breach of the common law duty of fairness.

The Court went further than had Carr J in upholding the MHRA’s case that it was acte clair that Article 8(3) permitted the EMA to make the request that it had made to the MHRA: there was therefore no basis for a reference to the CJEU.  But the Court also agreed with Carr J that, since the Article 8(3) request had not in fact affected to Roche’s disadvantage the information that would have been passed to the EMA in any event, the Court would not anyway have granted declaratory relief about that issue.  As to the question of Roche’s responsibility under the Penalties Regulation for deficiencies of its group company, the Court of Appeal agreed with the MHRA’s submissions that the situation where the MHRA might have expressed views to the EMA and European Commission (which would then have to decide if those views were right, any decision being challengeable on appeal to the General Court) was far from the type of situation where a court would grant declaratory relief of a view expressed by a Government department.

The judgment is important both for its account of the relationship between the Penalties Regulation and the powers of inspection set out in the Medicines Directive, but also more generally in dealing with the situations in which the Court will make references to the CJEU in a context where what is being sought is declaratory relief.

George Peretz QC represented the MHRA.

A copy of the judgment can be found here.