Chugai accused Haihe of infringing its Chinese patent CN2005800098776A titled ED-71 preparation, which is central to its innovative drug Eldecalcitol for the treatment of osteoporosis. Chugai filed an application for the patent in 2005 with the China National Intellectual Property Administration (CNIPA) and the granted patent will stay valid until 2025.

Chugai discovered the application for the registration of generic drug Eldecalcitol filed by Haihe and its patent certification under category IV on the Chinese Marketed Drug Patent Information Listing Platform (中国上市药品专利信息登记平台) administered by the National Medical Products Administration (NMPA). The certification under category IV says there is innovator drug patent information on the Platform, but the generic drug applicant believes the patent should be invalidated or the generic drug does not fall within the scope of the patent protection.

Beijing Intellectual Property Court has agreed to hear the case, which is of note as China’s first case of patent linkage.

Article 76 of China's Fourth Amendment of Patent Law (effective June 1, 2021) for the first time introduced a "dual-track" early resolution mechanism for resolving drug patent disputes during the marketing approval process of generic drugs, allowing innovative drug patent holders to institute a civil action or an administrative determination against generic drug applicants in order to stay the marketing approval process for generic drugs.

On July 4, 2021, the NMPA in conjunction with the CNIPA released the Measures for the Implementation of Early Resolution Mechanisms for Drug Patent Disputes (Trial) (药品专利纠纷早期解决机制实施办法（试行）).  The Measures set up a registration system, set up a dual mechanism (via Courts or via CNIPA) for preventing marketing approval of drugs based on registered patents, and provide an exclusivity period for generics that successfully challenge patents.

China’s Supreme People’s Court released Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Civil Cases Concerning Patent Disputes Related to Drugs Applied for Registration (最高人民法院关于审理申请注册的药品相关的专利权纠纷民事案件适用法律若干问题的规定) on July 5, 2021.

The Beijing Intellectual Property Court and the CNIPA are specially designated as the adjudication authorities of Article 76 proceedings.