Insulet Launches a Patent Lawsuit Against Eoflow in Europe

• Eoflow announced Insulet had filed an injunction on 3 July against Eoflow and Menarini requesting a ban on the manufacture, sale, distribution, and use of EOPatch in 17 European countries.

• Given that Eoflow should have reported this event earlier, this is likely to result in further loss of confidence on Eoflow by many investors in the near term.

• If Eoflow is able to complete its rights offering (albeit lower amount than proposed), this could boost its chances to become a formidable competitor to Insulet on a global basis.

On 22 August, Eoflow announced that Insulet had filed an injunction on 3 July against Eoflow and Menarini (distributor of Eoflow's products in EU) requesting a ban on the manufacture, sale, distribution, and use of EOPatch and GlucoMen Day Pump insulin pump products in the European Unified Patent Court (UPC) member countries, citing infringement of overseas intellectual property rights.

Menarini is the company that has an exclusive supply contract for the EoPatch in Europe and has the rights for 16 countries, excluding Italy, until the end of next year. Insulet alleges that EOPatch infringes on its clutch patent registered with the European Patent Office. The UPC member countries include Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Sweden. The amount claimed is 2.5 million euro (about 3.7 billion won). Eoflow announced that it plans to appoint a litigation representative and actively respond in accordance with legal procedures.

One of the key issues with this event is that Insulet filed this injunction on 3 July. However, Eoflow did not immediately reveal this injunction to investors. If the injunction is accepted, sales in major European countries may be halted. Since Europe is already a region where EoPatch is already being exported, the near term financial impact is likely to be greater than in the United States where Eoflow's products have not yet entered.