Japan’s pharmaceutical patent linkage system is facing a critical turning point. Unlike the U.S. Hatch-Waxman Act, Japan’s system relies on administrative notifications rather than statutory law, creating a structural disconnect between regulatory approval (under the Act on Pharmaceuticals and Medical Devices) and patent infringement liability (under the Patent Act). In 2025, this disconnect has manifested in conflicting court rulings and a new administrative initiative that may further complicate the landscape.

1. The 2025 Judicial Turmoil

Two major court decisions in May 2025 have shaken the industry, highlighting the unpredictability of enforcing extended patent rights against generics.

First, on May 15, 2025, the Tokyo District Court (Dasatinib Case) ruled that a generic version of the leukemia drug Sprycel did not infringe the innovator’s patent. While the innovator’s drug was a "hydrate," the generic used an "anhydrate." The court found that the generic manufacturer’s use of "proprietary technology" to formulate the anhydrate meant it was not "substantially identical" to the innovator’s product. This decision shocked the industry, as Japanese regulators treat hydrates and anhydrates as identical for approval purposes.

However, less than two weeks later, on May 27, 2025, the Intellectual Property High Court (Nalfurafine/Remitch Case) delivered a contrary, high-profile judgment ordering payment of over 20 billion JPY in damages against generic manufacturers. In this case, the IP High Court ruled that differences in additives were merely "minor differences" that did not negate "substantial identity." Crucially, the High Court explicitly rejected the "proprietary technology" defense regarding additives. As an IP High Court decision, this precedent likely overrides the logic used in the lower court’s Dasatinib ruling, suggesting the latter may be reversed on appeal.

2. Administrative Response: The "Expert Panel System"

Caught between these complex legal interpretations, the Ministry of Health, Labour and Welfare (MHLW) has announced plans to introduce an "Expert Panel" system. This committee will advise MHLW on patent issues during the generic approval process.

While intended to smooth the approval process, this initiative faces criticism. The committee’s opinions will lack legally binding force. This creates a risk of market disruption: a generic could be approved based on the panel’s non-infringement opinion, only to be later enjoined by a court finding infringement.

3. Outlook

The events of 2025 demonstrate that Japan’s "notification-based" patent linkage system is reaching its limits. With the administrative and judicial branches applying different yardsticks to the same products, the risk for both innovators and generics has increased. This complex situation may call for fundamental legislative reform in the near future to formally integrate judicial patent review into the drug approval process, rather than relying on non-binding administrative stopgap measures.