Questions & Answers

SPC MANUFACTURING WAIVER

Would an SPC manufacturing waiver change the European system of intellectual property rights (IPR)?

The SPC manufacturing waiver would neither change nor compromise the protection of intellectual property in any way. The study published by the European Commission emphatically endorses this point. Patent holders would continue to enjoy their market monopoly during SPC terms, both within and outside the EU, until expiration of the respective SPC protection period.

Would an SPC manufacturing waiver adversely affect R & D (research & development) activities in the pharma sector?

On the contrary. An SPC manufacturing waiver would have no negative impact on research and development (R & D). The EU continues to be a leader in R & D for complex generic and biosimilar medicines. Pharmaceutical companies prefer to keep R & D and production in the same location. The current regulations are driving relocation of generic medicine production to non-EU countries, and thus also their development and research, for years to come. The SPC manufacturing waiver would stimulate manufacturing and R & D investments in Europe.

Would it not be enough to simply introduce an SPC manufacturing waiver for export, but without including production for Day 1 post SPC expiration?

No, because partial introduction of an SPC manufacturing waiver for export purposes only would not stop industry relocation. It is unlikely, as well as not logical, for a company to invest in two manufacturing plants for the same product, i. e. one in Europe for export and one outside of Europe for EU import. In particular, biosimilar companies typically invest only in one manufacturing site for the drug substance. Similar limitations apply for all other complex generic products. In essence, if a day-1-launch post SPC expiry in Europe cannot be realized due to a limited SPC manufacturing waiver for export purposes only, the economic benefits identified by the CRA study (creation of jobs and additional value) cannot be seized by European stakeholders.

Have other developed countries already introduced SPC manufacturing waivers?

Yes, Canada recently included an SPC manufacturing waiver in its legislation. This gives Canadian companies an enormous competitive advantage if the EU does not follow suit with a change in its legislation.

Moreover, an SPC manufacturing waiver would also be in line with international standards of IP protection and in particular the WTO TRIPs agreement, which mandates a 20-year patent protection, but does not provide for any SPC or patent extensions. Therefore, a waiver under an SPC would not affect WTO commitments, and due to the particular legal nature of the SPC it would not affect any other international commitment.

Would an SPC manufacturing waiver increase the risk of generics and biosimilars finding their way into the EU market before supplementary protection certificates expire?

No. The current rules that give the original manufacturers a marketing monopoly will not change. The European Commission study emphatically endorses this point. Appropriate legal remedies (e.g. preliminary injunctions, right of information, etc.), strengthened by the serialisation of medicines, are available in all EU countries to block marketing of infringing medicinal products for as long as the original is protected by protection certificates.

The only objective of the SPC manufacturing waiver is to give generic and biosimilar manufacturers the option to produce medicines during the SPC term of the reference medicinal product within the EU for export and in preparation for market entry on day-1 post SPC-expiration. These medicines are already being produced, but in third countries. This means that both revenues and jobs are lost in the EU as a result.

Does the SPC manufacturing waiver contradict the EU’s declared aim to maintain its leading position in the global pharma sector?

The European pharmaceutical industry, including generic and biosimilar producers, continues to be one of the most powerful competitors across the globe. Any incentive to strengthen the sector within the EU will support the sector’s international competitiveness without disadvantaging the patent protected pharmaceutical business. As the study published by the European Commission demonstrates, waiving the manufacturing monopoly during the SPC protection period would benefit the entire EU pharmaceutical industry, including the active substance (API) sector. An SPC manufacturing waiver would benefit European SMEs in particular, both as service providers and subcontractors, because EU companies will no longer be forced into producing and cooperating with subcontractors in third countries.