# IMMC.EESC-2018-03800-AC.ENG.xhtml.EESC-2018-03800-00-00-AC-TRA-EN.docx

EN

European Economic and Social Committee

European Economic and Social Committee

INT/865

INT/865

Supplementary protection certificate for medicinal products

Supplementary protection certificate for medicinal products

OPINION


  European Economic and Social Committee


  Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 469/2009 concerning the supplementary protection certificate for medicinal products

  [COM(2018) 317 final – 2018/0161 (COD)]

OPINION

European Economic and Social Committee

Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 469/2009 concerning the supplementary protection certificate for medicinal products

[COM(2018) 317 final – 2018/0161 (COD)]

Rapporteur working alone: János WELTNER

Rapporteur working alone: János WELTNER

Referral

| Referral | Council, 21/06/2018


  European Parliament, 02/07/2018 |
| --- | --- |
| Legal basis | Article 114 of the Treaty on the Functioning of the European Union |
| | |
| Section responsible | Single Market, Production and Consumption |
| Adopted in section | 04/09/2018 |
| Adopted at plenary | 20/09/2018 |
| Plenary session No | 537 |
| Outcome of vote

  (for/against/abstentions) | 167/2/7 |

Referral

Council, 21/06/2018

Council, 21/06/2018

European Parliament, 02/07/2018

European Parliament, 02/07/2018

Legal basis

Legal basis

Article 114 of the Treaty on the Functioning of the European Union

Article 114 of the Treaty on the Functioning of the European Union

Section responsible

Section responsible

Single Market, Production and Consumption

Single Market, Production and Consumption

Adopted in section

Adopted in section

04/09/2018

04/09/2018

Adopted at plenary

Adopted at plenary

20/09/2018

20/09/2018

Plenary session No

Plenary session No

537

537

Outcome of vote

  (for/against/abstentions)

Outcome of vote

(for/against/abstentions)

167/2/7

167/2/7

1.Conclusions and recommendations

1.

Conclusions and recommendations

1.1The EESC takes note of the fact that the Commission, in its Staff Working Document (SWD), has analysed four options to deal with the current problems arising from the present status of the Supplementary Protection Certificate (SPC).

1.1

The EESC takes note of the fact that the Commission, in its Staff Working Document (SWD), has analysed four options to deal with the current problems arising from the present status of the Supplementary Protection Certificate (SPC).

1.2The EESC agrees with the European Commission's (EC) conclusion, which proposes modifications in line with Option 4
  1
  , i.e. legislation on both export and stockpiling waivers by amending Regulation 469/2009.

1.2

The EESC agrees with the European Commission's (EC) conclusion, which proposes modifications in line with Option 4

1

, i.e. legislation on both export and stockpiling waivers by amending Regulation 469/2009.

1.3The EESC welcomes the fact that this proposal leaves SPC protection intact as regards placing products on the EU market.

1.4The EESC also welcomes the market exclusivity of EU SPC holders in the Member States during the full period of SPC protection.

1.5The EESC deems it to be most important that, on those non-EU markets where protection does not exist or has expired, there be fair competition for EU-based manufacturers who bring generics and biosimilars to these markets.

1.6The EESC strongly supports those safeguards that ensure transparency and protect against a possible diversion onto the Union market of generics and biosimilars (G/Bs) in respect of which the original product is protected by an SPC.

1.7The EESC supports the Commission's stance on SMEs, since they play an important role in manufacturing generics and developing biosimilars. SMEs will be better able to plan their market activities if the new SPC comes into force.

1.8The EESC supports the Commission's plan for an evaluation of orphan and paediatric legislation, with further analysis in 2018-2019.

1.9The EESC understands the Commission's position that, although it would be advantageous, the Commission will not be tabling a proposal for a unitary SPC at the moment, as the unitary patent package has not yet come into force.

1.10The EESC supports the amendment of Regulation (EC) No 469/2009, as it is set out in document COM(2018) 317. At the same time, the EESC recommends that the Commission could propose to amend Regulation (EC) No 469/2009, as it is set out in document COM(2018) 317, to ensure that an SPC manufacturing waiver can be immediately applied.

2.Background

2.1An SPC will extend the period of effective protection for patents on new medicinal products, where an authorisation is required for them to be placed on the market.

2.2The holder of both a patent and an SPC benefits from a maximum of 15 years of protection from the moment the product in question first obtains authorisation to be placed on the market in the EU.

2.3The benefits of an SPC for its holder are significant. Since an SPC confers the same rights as a basic patent, the monopoly resulting from the basic (reference) patent is extended and enables its holder to prevent competitors from making use of the invention (manufacturing the medicine, offering it for sale, storing it, etc.) in those Member States in which an SPC has been granted.

2.4An SPC serves as compensation for the investment put into research. It should also compensate for further research, monitoring and waiting in the period between the patent application being filed and authorisation to place such a product on the market being received.

2.5In the EU, an SPC can be granted under the following conditions:

2.5.1On the date of application for supplementary protection the product is protected by a basic patent;

2.5.2The product has not already been the subject of a certificate;

2.5.3A valid and first administrative authorisation to place the product on the market as a medicinal product has been granted.

2.6The Stakeholders' Views
  2
   indicate that today's SPCs place EU-based manufacturers of generics and biosimilars (G/Bs) at a disadvantage vis-à-vis manufacturers capable of producing G/Bs outside the EU.

2.7In its current form, the EU SPC increases reliance on imports of drugs and pharmaceuticals outside the EU.

2.8The global pharmaceutical market has changed. Fast-growing economies (pharmerging) combined with ageing populations in the traditional industrialised regions have driven a massive demand for medicines. Total global spending on medicines increased from EUR 950 billion in 2012 to EUR 1.1 trillion in 2017 (USA 40%, China 20% and the EU less than 15%). Biologics will represent 25% of the pharmaceutical market value by 2022. This is being accompanied by a shift towards an ever-greater market share for G/Bs, which could represent 80% of medicines by volume by 2020 and about 28% of global sales.

2.9According to Medicines for Europe, 56% of medicines by volume currently supplied in the EU are G/Bs.

2.10The Bolar
  3
  exemption has eliminated an unintended side effect of strong patent protection, based on the rationale that free competition should be allowed as soon as protection expires. It is a manufacturing waiver for testing and clinical trials purposes, and was intended to ensure that a generic could enter the market as soon as possible after the expiry of patent/SPC protection.

2.11Regarding the SPC manufacturing waiver, EU firms are facing a situation similar to the pre-Bolar one. While the legitimate purpose of an SPC is to prevent the manufacturing of competing products for the purpose of marketing on the EU market while the SPC is in effect, it has two unintended and unforeseen consequences, namely:

2.11.1Preventing G/Bs from being manufactured in the EU and exported to third countries (where no legal protection applies) during the EU SPC term; and

2.11.2Preventing them from being manufactured in the EU (and then stored) early enough to be placed on the EU market immediately as of day-1.

2.12Manufacturers of G/Bs (based in a Member State where the application of a SPC for the reference medicine has been applied) face the following problems:

2.12.1During the period of protection covered by the certificate of the reference medicine in the EU, manufacturers cannot manufacture that medicine for any purpose, including for export outside the EU to countries where SPC protection for the reference medicine has expired or never existed, while manufacturers based in those third countries can do so.

2.12.2Immediately upon expiry of the certificate: they are not ready to enter the EU market on day-1, since the EU SPC system does not allow manufacturing in the EU until then. By contrast, manufacturers based in third countries where SPC protection for the reference medicine has expired earlier, or never existed at all, can be ready to enter the EU market as of day-1, via exports, and thus gain a considerable competitive advantage.

2.13The G/B sector now accounts for 160 000 jobs in the EU (Medicines for Europe). The loss of jobs, especially of highly skilled jobs, loss of know-how and a brain drain to non-EU countries, notably to Asia, must be prevented by an urgent change in the regulation of SPCs.

2.14The EU was a pioneer in the development of regulatory procedures to approve biosimilars: the EMA authorised the first biosimilar in 2006, while the FDA did so only in 2015. However, there are clear signs that Europe is now losing its competitive edge, with its trade partners catching up. Therefore there is an urgent need for the EU to restore the competitiveness of EU-based manufacturers of G/Bs. Doing nothing or postponing an initiative would further weaken the EU industry and unravel the EU's pioneering effect and competitive advantage in the biosimilar sector in particular.

2.15In accordance with the Single Market Strategy, a targeted recalibration of certain aspects of SPCs is needed, aiming to tackle the following problems:

2.15.1Loss of export markets in unprotected third countries;

2.15.2Day-1 entry onto Member States' markets for EU-based manufacturers of G/Bs by introducing an "SPC manufacturing waiver" in the EU SPC legislation, allowing the manufacture of G/Bs within the EU during the SPC term;

2.15.3Fragmentation resulting from the uneven implementation of the current SPC regime in the Member States that could be solved in connection with the upcoming unitary patent, and the possible creation thereafter of a unitary SPC title;

2.15.4Fragmented implementation of the Bolar research exemption.

3.General comments

3.1What can we expect from the new regulation?

3.1.1Strengthening and retaining manufacturing capacity and know-how in the EU, thereby reducing unnecessary relocation/outsourcing.

3.1.2Strengthening EU patients' access to medicines by diversifying geographical sources of supply and thus strengthening home production.

3.1.3Removing obstacles to starting generic and biosimilar businesses in the EU, especially for SMEs that have more difficulties in overcoming obstacles and which may have difficulties if they have to face non-EU competition.

3.1.4As manufacturing capacity established for export purposes can, prior to expiry of the certificate, be used with a view to supplying the EU market from day-1, it is also expected to boost, to some extent, access to medicines in the Union by enabling G/Bs to enter the market more quickly after the certificates have expired, thus ensuring the availability of a wider choice of affordable medicines once the period of patent and SPC protection has passed. This should have a positive effect on national health budgets.

3.1.5The proposal will, to some extent, make medicines more accessible to EU patients, especially in those Member States in which access to some reference medicines (e.g. certain biologics) is difficult, by creating the conditions to help related G/Bs gain more rapid entry into the Union market once the relevant certificates have expired. It will also diversify the geographical origin of medicines available in the EU, thus strengthening the supply chain and security of supply.

4.Specific comments

4.1The EC may find some way to use EU funds to support the building of manufacturing capacity in Member States for export purposes during the SPC term. This may, for certain products, allow a quicker scale-up of production for entering the EU market on day-1.

4.2The Commission may support the activities of interested NGOs for developing indicators for monitoring and evaluating the new SPCs for the future development of the EU market share of EU-manufactured generics and biosimilars.

Brussels, 20 September 2018

Luca JAHIER

  The president of the European Economic and Social Committee

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