Actual Conditions and Problems of Protection of Patent Rights for Tissue-Engineered MedicalProducts, etc., In Vitro Diagnostic Medicines, etc. as Provided in Article 2, Item (ii) of the Orderfor Enforcement of the Patent Act

I. Purpose of This Research
In this research, we study the actual conditions of protection of patent rights for tissueengineered medical products, etc., in vitro diagnostic medicines, etc. in Japan and abroad, problems
in the relationship with the system of registration of extension of duration, possible disposition(approval for manufacturing and sale), etc., to use the results thereof as basic materials forconsidering measures to solve problems in the relationship with the system of registration ofextension of duration for tissue-engineered medical products, etc., in vitro diagnostic medicines,
etc., and consider a desirable structure and operation of the system, etc.

II. Contents of This Research(1) System of registration of extension of duration in Japan
Article 67, paragraph (2) of the Patent Act provides that "Where there is a period during which
the patented invention is unable to be worked because approvals prescribed by relevant Acts thatare intended to ensure the safety, etc. or any other disposition designated by Cabinet Order as
requiring considerable time for the proper execution of the disposition in light of the purpose,procedures, etc., of such a disposition is necessary to obtain for the working of the patented
invention, the duration of the patent right may be extended, upon the filing of an application toregister an extension of the duration, by a period not exceeding 5 years."
The extension of duration can be registered for patents for tissue-engineered medical products,
etc. and in vitro diagnostic medicines under this provision. On the other hand, patents for medical
devices are not subject to the system of registration of extension of duration in Japan (Article 2,
item (ii)(b) to (d) of the Order for Enforcement of the Patent Act).
The "period during which the patented invention is unable to be worked" as referred to in
Article 67, paragraph (2) of the Patent Act is defined as follows in "Part IX Extension of PatentTerm" in the Examination Guidelines for Patent and Utility Model in Japan: "This period begins on
the date on which testing necessary for obtaining the disposition designated by Cabinet Ordercommences or the date on which establishment of the relevant patent is registered: whichevercomes later; and ends on the day before the date on which the approval or registration reaches theapplicant, i.e. the date on which the applicant actually learns of the approval or registration or could
have learned of it." The "date on which a testing necessary for obtaining the disposition designatedby Cabinet Order commences" is defined as the date of commencement of a clinical trial which isindicated by the date of notification of a clinical trial plan, etc. in the case of a medicine.
Where a tissue-engineered medical product, etc. is subjected to an approval with conditions andlimited term, the "date on which the approval or registration reaches the applicant" is a date
pertaining to the approval with conditions and limited term, and it is not a date pertaining to a
subsequent approval after said approval (Article 2, item (ii)(d) of the Order for Enforcement of thePatent Act).
The scope of effect of a patent right for which extension of duration was registered is provided
as the working of the patented invention for which extension of duration was registered for theproduct which was the subject of a disposition (where the specific usage of the product isprescribed by the disposition, the product used for that usage) in Article 68-2 of the Patent Act.
(2) System of approval for manufacturing and sale in Japan
The Act on Securing Quality, Efficacy and Safety of Products Including Pharmaceuticals andMedical Devices (hereinafter referred to as the "Pharmaceuticals and Medical Devices Act")
provides relevant regulations. In the Pharmaceuticals and Medical Devices Act, the relevant
provisions concerning the manufacturing and sale of tissue-engineered medical products, etc. aremainly in Chapter VI (Articles 23-20 to 23-42), and the relevant provisions of manufacturing andsale of in vitro diagnostic medicines and medical devices are mainly in Chapter V (Articles 23-2 to23-19).
Review for the approval of manufacturing and sale is conducted by the Pharmaceuticals andMedical Devices Agency (PMDA).
Article 23-25 of the Pharmaceuticals and Medical Devices Act provides that it is necessary toobtain approval for manufacturing and sale for tissue-engineered medical products, etc. before
selling them. As a long period of time is required for clinical trials for tissue-engineered medicalproducts, etc., the two-stage approval system consisting of "approval with conditions and limitedterm" and "full-scale approval" is adopted, thereby making it possible to place tissue-engineered
medical products, etc. on the market at an early date when a certain number of cases are obtained
through clinical trials.
Regarding in vitro diagnostic medicines, it is necessary to obtain approval for manufacturingand sale for Class III products and Class I and II products which do not conform to the standards
before selling them. It is not necessary to obtain approval for manufacturing and selling for Class IIproducts which conform to the certification standards before selling them, but it is necessary toobtain a third party certification from a person who has received accreditation from the Minister ofHealth, Labour and Welfare ("accredited certification body") for each item in the same manner asfor Class II medical devices mentioned later.
Regarding medical devices, it is necessary to obtain approval for manufacturing and sale forClass III and IV products and Class II products for which no certification standards have been set.
It is not necessary to obtain approval for manufacturing and sale for Class II products for which
certification standards have been set, but it is necessary to obtain a third party certification from anaccredited certification body for each item.
(3) Results of the domestic questionnaire and interview surveys(i) Regarding the system of registration of extension of duration
According to the results of the questionnaire survey, many respondents answered, as the matterson which emphasis should be put in relation to the system of registration of extension of duration,that "the system achieves a balance between promoting innovation by original product producers
and not inhibiting the market entry of generic products" and that "the system and its operation areeasy to understand." Regarding the scope of effect which is extended through registration ofextension of duration of a patent right, many respondents answered that it is necessary to "makeclear the scope of effect of extended patent rights" and "to ensure that the scope of effect ofextended patent rights for innovative inventions are appropriate so that it matches theinnovativeness of the inventions" because there were many unclear points in relation to the scope ofeffect as of the time when this research was started though there were relevant holdings in theobiter dictum in the judgment of the Grand Panel of the Intellectual Property High Court of May 30,
2014 and the judgment of the Tokyo District Court of March 30, 2016 (2015 (Wa) 12414).
(ii) Regarding the registration of extension of duration for tissue-engineered medical products, etc.
Regarding the registration of extension of duration for tissue-engineered medical products, etc.,
it was revealed that [i] there are still few cases of registration in Japan because only a few tissueengineered medical products, etc. have been approved, that [ii] for overseas, there is no case ofregistration in the United States, and there are only a few cases of registration in Europe and SouthKorea, and that [iii] there has been no relevant trial and court decision in Japan and abroad.
However, as a long period of time is required for the development of tissue-engineered medical
products, etc., the questionnaire and interview survey results indicated the high need for theregistration of extension of duration for tissue-engineered medical products, etc. in the samemanner as medicines, etc. among companies and universities, etc.
Moreover, when considering the system of extension of duration, it is important to ensure thatthe system of registration of extension of duration does not inhibit the development of subsequent
products, and it is thus necessary to consider subsequent products that can be developed. However,as a result of the questionnaire and interview surveys, companies and universities, etc. expressed
the opinion that it is difficult at present to determine equivalence of cells and the subsequent
products of tissue-engineered medical products, etc. are therefore very unlikely to be put on themarket. Consequently, it is necessary to keep a close eye on the development of tissue-engineeringresearch in the future.
Regarding patents that protect tissue-engineered medical products, etc., in the interview survey,
companies and universities, etc. made the comment that the ratio of process patents is on theincrease. However, there were also the following opinions: [i] relationship between process
patents and tissue-engineered medical products, etc. is difficult to understand; [ii] the scope ofeffect of extended patent rights is difficult to understand; and [iii] it is difficult for universities, etc.
which are licensors to move licensing activities forward.
(iii) Regarding the registration of extension of duration for in vitro diagnostic medicines
Regarding the registration of extension of duration for in vitro diagnostic medicines, it wasrevealed that there are not many cases of registration of extension because the period necessary forclinical trials and dispositions for in vitro diagnostic medicines is generally short and no adverse
effect has arisen due to a period during which a patented invention is unable to be worked.
However, regarding companion diagnostic medicines, many respondents expressed the opinion, in
the interview survey, that registration of extension is necessary because a period during which apatented invention is unable to be worked is likely to be longer than that for in vitro diagnostic
medicines in general because clinical trials for companion diagnostic medicines are conducted inparallel with ordinary medicines.
(iv) Regarding the need for the registration of extension of duration for medical devices
According to the questionnaire and interview survey results, regarding the registration ofextension of duration for medical devices, only a few companies consider the fact that medical
devices are not subject to the system of registration of extension of duration to be inconvenient,and there was the also opinion that there is little need for the registration of extension of duration
because the period necessary for obtaining approval and the life cycle of medical device products
are short. Therefore, the need for making medical devices in general subject to the system ofregistration of extension of duration is recognized as low in the present circumstances. However,for medical devices in some fields, the period necessary for obtaining approval has become longer,
and there is also the opinion that the system of registration of extension of duration is necessary.
Therefore, it is necessary to keep a close eye on the progress of development of medical devices
and the trend of the period necessary for obtaining approval, etc. in the future.
(4) Regarding the system of registration of extension of duration in other countries(i) United States
In the United States, extension of duration can be registered for patents for tissue-engineered
medical products, etc., in vitro diagnostic medicines, and medical devices (Section 156 of U.S.
patent law). However, for in vitro diagnostic medicines and medical devices, only Class III
products that are subject to a premarket approval application (PMA) are subject to the registrationof extension of duration. Regarding in vitro diagnostic medicines, there are very few patents forwhich extensions of duration were registered, in the present circumstances.
Section 156(a) of U.S. patent law provides that duration can be extended only for the productwhich was first approved. In the case of tissue-engineered medical products, etc., extension ofduration is unlikely to be available for a product whose "major ingredient" has already beenapproved even if the product is subsequently approved after the medium, culture solution, andtransportation tube are changed.
(ii) Europe
In Europe, extension of duration can be registered for patents for tissue-engineered medicalproducts, etc. However, patents for in vitro diagnostic medicines and medical devices are notsubject to approval for manufacturing and sale, and therefore, they are not subject to theregistration of extension of duration (Article 63, paragraph 2(b) of the Convention on the Grant ofEuropean Patents and Article 1 of the Supplementary Protection Certificate (SPC) Regulation).
However, there are cases where extension of duration was granted for products for which clinicaltrials of the same level as those for medicines are required at the member state's discretion inGermany, the United Kingdom, the Netherlands, France, Italy, etc.
In the case of tissue-engineered medical products, etc., there is little chance of extension ofduration being granted in the case where the only difference between a prior product and asubsequent product is a difference in the carrier, such as medium and culture solution, and said
subsequent product is designated for the same usage as that of the prior product.
(iii) South Korea
In South Korea, extension of duration can be registered for patents for tissue-engineered medical
products, etc. However, patents for in vitro diagnostic medicines and medical devices are notsubject to the registration of extension of duration (Article 89 of the South Korean Patent Act andArticle 7 of the South Korean Enforcement Decree of the Patent Act) because they are not subject
to the regulation under the Pharmaceutical Affairs Act but are subject to the regulation under theMedical Devices Act.
Article 7, paragraph (1) of the South Korean Enforcement Decree of the Patent Act provides
that being a new medicine is a condition for being subject to the registration of extension ofduration. In the case where a component cell or transgene, which is the major ingredient, is thesame, only the structures other than the major ingredient, such as the medium, culture solution, andtransportation tube, are changed, and permission is obtained for the major ingredient, the relevant
patent cannot be subject to the registration of extension of duration in the same manner as the casesof general medicines even if another permission is subsequently obtained.
(5) Results of discussions at the committee
The committee held discussions on a desirable structure of the system of extension of duration ofa patent right, including a desirable structure of the system of registration of extension for tissueengineered medical products, etc. and in vitro diagnostic medicines, etc.
Various opinions were expressed due to differences in the positions of individual committee
members. However, all the committee members, including original product producers and genericproducers, agreed that the matters on which emphasis should be placed in relation to the system ofextension of duration of a patent right are that [i] the system of extension of duration of a patentright should be one that achieves a balance between promoting innovation by original productproducers and not inhibiting the market entry of generic products" and that [ii] the system and its
operation should be easy to understand. The committee members, including original productproducers and generic producers, achieved the consensus that a desirable structure of the system ofextension of duration of a patent right should be considered based on such recognition.
Moreover, both original product producers and generic producers expressed concerns about thefact that the system of extension of duration of a patent right has become more complex as a resultof multiple Supreme Court judgments concerning the requirements for filing an application toregister an extension of duration and revisions to the JPO Examination Guidelines associated withthose judgments.
(6) Opinions concerning the judgment of the Grand Panel of the Intellectual Property High Court
On January 20, 2017, the appeal court judgment for the aforementioned Tokyo District Court
judgment was rendered as the judgment of the Grand Panel of the Intellectual Property High Courtin relation to the effect of a patent right for which extension of duration was registered. Therefore,
we heard the opinions of the committee members again.
The committee members presented the opinion that they appreciate said judgment in that thecourt ruled that a patent right whose duration was extended is effective not only against productsthat are identical with the product subject to a disposition but also against products that aresubstantially identical with the product subject to a disposition as a medicine and indicatedstandards for determination of the scope of substantial identity and specific types. In addition, thecommittee members expressed the opinion that they expect the same idea to be adopted for tissueengineered medical products, etc.
On the other hand, the committee members expressed the opinions that said judgment differsfrom the interpretation that has been adopted since the establishment of the system of registrationof extension of duration, that interpretation of "substantial identity" in specific cases remains
unclear, and that an accumulation of judgments in the future is awaited for the clarification ofinterpretation of "substantial identity."

Ⅲ. Summary
This research made clear that the system of registration of extension of duration of a patentright needs to be one that fits with the times, taking into account changes in the research anddevelopment environment and emergence of patents in the forms that were not assumed at the timeof establishment of the system of extension of duration of a patent right, such as tissue engineeringand drug delivery system (DDS), after 30 years have passed since the establishment of the system.
Therefore, we hope that further discussions will be held on the current system of registration ofextension of duration of a patent right that includes matters such as tissue-engineered medical
products, etc. and in vitro diagnostic medicines as its subject of protection, in relation to matterssuch as "patent rights subject to extension," "dispositions subject to extension," the "number ofpatents whose duration can be extended by one disposition," the "number of times of extension for
one patent," and the "effect of extended patent rights," as needed, in light of the coming trends ofjudicial rulings while listening to the needs of both original product producers and genericproducers, in order to make the system one that achieves a balance in its influence on thedevelopment of original and generic products.