Danish Enzyme Bites Chinese Dragon

The conventional wisdom is that in a foreign company v. Chinese company patent suit, the Chinese company will always win. Maybe not. Danish company, Novozymes, had patented an enzyme for use in bioenergy and beverages. Novozymes sued two Chinese companies, Shandong Longda Bio Products and Jiangsu Boli Bioproducts for patent infringement. Novozymes brought the case in China. After six years of litigation, the Supreme People’s Court entered judgment against the Chinese companies. Two things make this victory even sweeter. First, certain types of biotechnology are harder to support under Chinese patent rules than patent rules in the U.S. and Europe. Second, the Chinese government devotes significant resources to Chinese companies’ research and development in the area of biotechnology.

WHY YOU SHOULD KNOW THIS. This result is not typical. That’s why it’s newsworthy. High tech innovation is always vulnerable to patent infringers who want to get there faster without the expense of research and development. Patent enforcement can be hard in foreign, and sometimes hostile, jurisdictions. For a company, patent enforcement problems can be a critical element when looking to expand into extraterritorial markets. If the Supreme People’s Court has started a trend towards protecting the patents of non-Chinese companies, new market expansion evaluations may change.