Impact of SPC Manufacturing waiver on API in Europe according to European Commission according to the official studies published by the European Commission
European Commission reported:
- An SPC manufacturing waiver for export AND stockpiling would be “the most effective and simplest option”, Impact Assessment, p. 105.
- The actual SPC system “ has two unintended consequences that were not foreseen, namely preventing generics/biosimilars (1) from being manufactured in the EU and exported to third countries (where no legal protection applies) during the EU SPC term, and (2) from being manufactured in the EU (and then stored) early enough to be placed on the EU market immediately from day-1”, Impact Assessment, p.15.
- “The main consequence of the above-mentioned problems is increased relocation and/or outsourcing of the manufacturing of generics/biosimilars outside the EU, and loss of business opportunities inside the Union more generally” p. 19. “As mentioned above, such a waiver could potentially reduce the risk of relocation, not only of manufacturing, but also of R&D (in the biologics/biosimilars sector)”, Impact Assessment, p. 41.
- “Loss of manufacturing capacity: once production is delocalised, it might well never return to the EU. This risk affects EU-based SPC-holders (that also use the manufacturing capacity of generic manufacturers) as well as generics and biosimilars manufacturer”, Impact Assessment, p. 20.
- “Switching API suppliers has a high cost due to the requirement of new stability batches and new analytical studies on impurities, among others. It is estimated that for the more complex APIs, the cost associated to a change of API supplier could be around EUR 4m. Therefore, once an API supplier is chosen, the decision tends to be irreversible.”, Impact Assessment, p. 20.
- “The waiver is also expected to improve access to the APIs and make the supply chain stronger”. “For SME manufacturers that are currently not exporting outside the EU, and do not plan to scale up to export outside the EU, a stockpiling waiver would assist in scaling up production to be ready for timely entry into domestic or to other Member State market upon SPC expiry”, Impact Assessment, p. 106.
- The EC notes that “there is no evidence of illicit diversion resulting from the existence of the ‘Bolar exemption’ in the EU, which itself is a form of manufacturing waiver for clinical trials purposes (and is available during the term of both patents and SPCs)”, Impact Assessment, p. 35.
- “[U]rgent need to tackle the specific problems faced by EU-based generics and biosimilars manufacturers”, and that “[t]his has been understood by EU’s trade partners”. Therefore, the EC concludes that “[d]oing nothing, or postponing an initiative would, firstly, further weaken the EU pharmaceutical industry”. However, according to the actual proposal, the waiver would presumably “on average, be available from 2025”, Impact Assessment, p. 76.
The European Commission provided NO evidence against but only strong support in its official studies to:
- Introduce the “EU day-1 launch”
- Remove anti-competitive, unjustified and unnecessary anti-diversion measures
- Allow an immediate applicability of the SPC manufacturing waiver
THE EUROPEAN COMMISSION PROPOSED AN SPC MANUFACTURING WAIVER:
- for export only
- with anti-diversion measures
- applicable only to newly granted SPCs