Following the European Commission’s draft proposal for implementing the so-called SPC manufacturing waiver the Committee on Legal Affairs of the European Parliament published a draft report on presenting its suggested amendments to the Commission’s proposal. The Committee in essence supports the plan to introduce the manufacturing waiver but is asking for some clarifying amendments as well as certain substantive changes.

Background

As a reminder, the Supplementary Protection Certificate (SPC) is an IP right offering patent owners an extension of up to 5 years of the basic patent’s effective protection period in order to compensate for the time needed to complete the marketing authorization procedure. This can take up a significant period of time, during which the owner of a patent that protects an active ingredient is unable to commercially exploit the period of exclusivity offered by that patent. The legal framework of SPCs is provided by Regulation 469/2009 concerning the supplementary protection certificate for medicinal products.

In order to strengthen the competitiveness of EU based manufacturers of generics and biosimilars, the European Commission intends to amend Regulation 469/2009 so as to introduce a manufacturing waiver. This is an exemption to the protection offered by SPCs which would allow the manufacture of medicinal products in the EU during the period of protection if these products are solely intended to be sold in third countries – that is outside the EU (see our earlier coverage).

Suggested amendments

The EU Parliament’s Committee on Legal Affairs has adopted a couple of amendments to the Commission’s draft proposal that are aimed at clarifying the wording and to better match the language used in Regulation 469/2009. In addition the Committee has made amendments to the information obligations imposed on generic manufacturers as well as the new rule’s period of applicability. The most important amendments are as follows:

• The term ‘third countries’ specifically means countries outside the EU.
• Instead of the 28 days period intended in the Commission’s draft, the generic manufacturers have to inform the competent authority in the Member State in which the manufacture will take place at least 3 months prior to the start date of manufacturing.
• The generic manufacturers have to inform not only the competent authority of their intention to manufacture the product, but also the certificate holder whose SPC would be affected. There are some exceptions regarding certain confidential or commercially sensitive information. A standard form must be used for the notification.
• The manufacturing waiver shall only apply to certificates for which the basic patent expired on or after 1 January 2023.

Evaluation of the suggested amendments

A positive development for SPC holders is the requirement for notification of the intended production to be made three months before the start of production and that this notification should also be made to the relevant right holder. The proposal for a uniform entry into force from 2023 is sensible as it will avoid fragmented implementation resulting from differing durations of the SPC granting procedure in Member States. However, concerns remain that the protection provided by SPCs will be undermined as a result of the new law, especially since the obligation to affix the “EU export” mark still only applies to the outer packaging of the medicinal product, thus potentially facilitating unlawful reimports.

Outlook

Overall, the future fate of the SPC Manufacturing Waiver appears uncertain. It cannot be assumed that the legislative process will be completed before the European Parliament elections take place in May 2019. When and in what form the legislative process will be resumed after the new European Parliament has been constituted cannot be predicted.

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