CHINA – The Supreme People’s Court of China, the country’s highest court, has ruled against two local firms in a patent infringement case brought by enzyme maker, Novozymes, in what the company calls an ‘important step towards protecting biotech innovations.’

The case centered on allegations by Denmark based enzymes maker against two China based firms that they were using its patent for enzymes used in the production of fuel and beverage alcohol.

In a rare landmark case on the validity of patents covering biotech innovations, the Supreme People’s Court of China decided in favour of Novozymes in a trial against two of its competitors, Shandong Longda Bio-Products Co., Ltd. (Longda) and Jiangsu Boli Bioproducts Co., Ltd., (Boli) which had been accused of infringing on Novozymes’ enzyme patent.

“We are pleased with the Court’s decision and wish to commend the Chinese patent and court system for taking an important step towards protecting biotech innovations,” said Novozymes’ General Counsel Mikkel Viltoft.

“This landmark verdict will spur growth and investments in China and encourage local inventions, and it shows that China is serious in its efforts to protect intellectual property rights.

“We firmly believe it is in society’s best interest that intellectual property rights are respected, as this provides the necessary incentive to invest in tomorrow’s innovations,” he continued.

“The dispute between the two enzyme makers Longda and Boli and Novozymes began in 2011, when Novozymes found evidence that the two were producing and selling a proprietary Novozymes glucoamylase enzyme for use in the bioenergy and beverage industries in violation of one of Novozymes’ Chinese patents.

In 2012 and 2013, two courts in Tianjin ordered Longda and Boli to stop making and selling the products and pay statutory damages totaling RMB 1.7 million (US$246,000) to Novozymes.

But the two companies appealed, arguing that the patent was invalid. The case then went through various levels of Chinese lower courts, before it reached the Supreme People’s Court of China, which has now decided that the patent is valid.

The court’s verdict is final and cannot be appealed, says Novozymes.

Novozymes has been in China for over 20 years and has over 1,000 employees across 6 facilities in the country, where it operates research & development, production, sales, marketing and other support functions.

Copyright infringement is a great concern for Western corporates getting into China.