Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2018/0161 (COD)**

**PROPOSAL**

**Brussels, 29 May 2018**
**(OR. en)**

**9485/18**

**PI 65**
**CODEC 888**
**COMPET 374**
**PHARM 28**
**IA 147**

From: Secretary-General of the European Commission,
signed by Mr Jordi AYET PUIGARNAU, Director

date of receipt: 28 May 2018

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council of
the European Union

No. Cion doc.: COM(2018) 317 final

Subject: 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

Delegations will find attached document COM(2018) 317 final.

Encl.: COM(2018) 317 final

9485/18 LK/np
## DGG 3B EN

EUROPEAN

COMMISSION

Brussels, 28.5.2018
COM(2018) 317 final

2018/0161 (COD)

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**

(Text with EEA relevance)

{SEC(2018) 246 final} - {SWD(2018) 240 final} - {SWD(2018) 241 final} 
{SWD(2018) 242 final}

# **EN EN**

**EXPLANATORY MEMORANDUM**

**CONTEXT** **OF** **THE** **PROPOSAL**

The Single Market Strategy [1] announced a targeted recalibration of certain aspects of patent
and SPC (Supplementary Protection Certificate) [2] protection to boost the competitiveness of
regulated industries such as the pharmaceutical industry. The aim was to tackle the following
problems:

–
loss of export markets (including new business opportunities), and lack of timely
(namely ‘ _day-1_ ’) entry onto Member State markets following expiry of the SPC, for
EU-based manufacturers of generics and biosimilars, due to unintended effects
stemming from the current EU SPC regime adopted almost three decades ago, and in
view of changes in the pharmaceutical sector (e.g. the emergence of biosimilars);

–
fragmented implementation of the SPC regime in Member States, which may be
solved in connection with the upcoming EU unitary patent, and the possible creation
thereafter of a unitary SPC title;

– fragmented implementation of the ‘Bolar’ patent exemption [3] .

The European Parliament’s Resolution [4] on the Single Market Strategy endorsed the need for
actions on the EU SPC regime and ‘ _urge[d] the Commission to introduce and implement_
_before 2019 an SPC manufacturing waiver_ ’, so as to boost the competitiveness of the generics
and biosimilars sector, but ‘ _without undermining the market exclusivity granted under the_
_SPC regime in protected markets_ ’.

This initiative delivers on the first of these abovementioned issues and, to that end, proposes
an amendment to the Union’s legislation on Supplementary Protection Certificates for
medicinal products, namely Regulation (EC) No 469/2009 [5] . It aims to introduce a so-called
manufacturing exemption for export purposes (also known as a manufacturing waiver) during
the term of an SPC. This would take the form of an ‘exception’, in other words, a restriction,
to the protection conferred to the certificate, which would aim at removing the competitive
disadvantages EU-based manufacturers of generics and biosimilars are currently facing. It

1 COM(2015)550.

2 A Supplementary Protection Certificate (‘SPC’) is a _sui generis_ intellectual property right, available in EU
Member States, that extends by up to five years the legal effects of a reference (‘basic’) patent which pertains
to a medicine or a plant protection product (e.g. a pesticide) that has been authorised by national or EU
regulatory authorities. The relevant EU legislation for SPCs on medicinal products is Regulation (EC) No
469/2009 (a codification of Regulation (EEC) No 1768/92). SPCs are intended to compensate for the ‘loss’
of effective patent protection caused by lengthy compulsory testing and clinical trials required before a
medicine is authorised to be placed on the EU market. The Paediatric Regulation (Regulation (EC) No
1901/2006 on medicinal products for paediatric use) provides for SPCs for a medicinal product to be
extended by a further six months if the authorised medicine has been part of a ‘paediatric investigation plan’.
Regulation (EC) No 1610/96 regulates SPCs for plant protection products, but is not the subject of this
proposal.

3 The exemption is defined by Article 10(6) of Directive 2001/83/EC on the Community code relating to
medicinal products for human use, which states that ‘ _Conducting the necessary studies and trials with a view_
_to the application of paragraphs 1, 2, 3 and 4 and the consequential practical requirements shall not be_
_regarded as contrary to patent rights or to supplementary protection certificates for medicinal products_ ’.

4 European Parliament Resolution of 26.5.2016 on the Single Market Strategy – 2015/2354(INI).

5 Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 concerning the
supplementary protection certificate for medicinal products (OJ L 152, 16.6.2009, p. 1).

# EN 1 EN

will allow them to manufacture, in the territory of a Member State during the term of an SPC,
for the exclusive purpose of exporting their products to non-EU markets where patent or SPC
protection has expired or never existed. The objective is to boost investment and job creation
in the manufacturing of generics and biosimilars in the Union by restoring a level playing
field between EU-based manufacturing and manufacturing in non-EU countries. This
exception should not affect the exclusive rights of certificate holders in relation to the Union
market. EU-based small and medium-sized enterprises (SMEs) in particular will benefit from
the proposal, as they are often engaged in the production of generics and biosimilars.

This initiative is backed by a series of studies. In addition, an inception impact assessment
was published in February 2017 announcing possible legislative and non-legislative initiatives
to tackle the targeted problems.

Furthermore, a 12-week public consultation was launched in October 2017, which
demonstrates support from a variety of stakeholders for a manufacturing waiver [6] . This
consultation shows strong support for a unitary SPC title. Furthermore, while many
stakeholders consider that the SPC system is fit for purpose, others believe there is a need for
more clarity on how the SPC Regulation and the _Bolar_ patent exemption are applied in
practice. However, it seems appropriate first to await finalisation of the Commission’s
ongoing analysis of pharmaceutical incentives [7] . In addition, any future guidance on the SPC
system in general should await the outcome of currently pending SPC cases before the Court
of Justice of the European Union.

**•** **Main features of the proposal**

This legislative initiative proposes a limited exception, by means of a ‘manufacturing waiver’,
to the rights that may be exercised by the holder of an SPC under Regulation (EC) No
469/2009. It is a targeted and balanced proposal aiming to remedy certain unintended
consequences resulting from the SPC regime on EU-based manufacturers of generics and
biosimilars, in view of the changes that the pharmaceutical industry has undergone during the
last three decades.

A harmonised SPC system was first introduced in 1992. It sought to compensate for the loss
of effective patent protection due to the time required in order to obtain marketing
authorisation (including research and clinical trials). The period of effective protection under
the patent was recognised as insufficient to cover investment in research, thereby penalising
pharmaceutical research. By providing for a period of supplementary protection which,
depending on the circumstances of a particular case, could be granted for a period ranging
from one day to a maximum of five years, the Regulation therefore aimed to provide the
pharmaceutical industry with sufficient incentives to innovate and to promote, within the
Union, the investment in research and innovation needed to develop medicinal products and
to prevent the relocation of pharmaceutical research outside the Union.

6 SWD(2018)242, Summary of the replies to the public consultation on Supplementary Protection Certificates
and patent research exemptions for sectors whose products are subject to regulated market authorisations.

7 On 17.6.2016, the Council, during its health session, adopted conclusions on ‘strengthening the balance in the
pharmaceutical systems in the EU’, in which it asked the Commission to conduct an evidence-based analysis
of the impact of the EU’s pharmaceutical incentives – including the SPC and the ‘Bolar’ exemption – on
innovation and access to medicines (Council document 10315/16). This analysis is currently ongoing.

# EN 2 EN

Reliance on SPC protection is significant and increasing [8] . At the same time however, EU and
global pharmaceutical markets are undergoing profound changes. Global demand for
medicines has increased massively (reaching EUR 1.1 trillion in 2017). Alongside this, there
is a shift towards an ever-greater market share for generics and biosimilars. Assuming an
annual growth rate of 6.9%, by 2020 generics and biosimilars will represent 80% of all
medicines by volume, and about 28% by value.

With regard to ‘innovative’ medicines, biologics – in other words, the original medicines to
which biosimilars relate – are projected to account for a quarter of the pharmaceutical market
by value by 2022. It has been estimated that, with the expiry of industrial property protection,
over EUR 90 billion of the first generation of _blockbuster_ biologics will become open to
biosimilar competition by 2020. This will create huge additional opportunities for growth and
jobs [9] .

Traditionally, the EU has been a hub for pharmaceutical research and development (R&D)
and production. Biosimilar production, for instance, started in 2006 in the EU, in other words
much earlier than elsewhere, and given its excellent ecosystem for this type of production, the
EU became a world leader in biosimilar development [10] .

However, its competitive position is under threat today. While Europe’s trading partners are
increasingly involved in the manufacturing of generics and biosimilars, EU-based
manufacturers [11] of generics and/or biosimilars face a significant problem: during the SPC
period of protection of the product in the EU, they cannot manufacture for any purpose,
including export outside the EU to countries where SPC protection has expired or does not
exist, while manufacturers based in those non-EU countries can do so [12] .

This problem puts EU-based industry at a disadvantage vis-à-vis manufacturers located
outside the EU, not only in global markets, but also in _day-1_ EU markets. This is because the
certificate makes it more difficult for EU manufacturers to enter the EU market immediately
after its expiry, given that they are not in a position to build up production capacity until the
protection provided by the certificate has lapsed. The same is not true of manufacturers
located in non-EU countries where protection does not exist or has expired. The problem is
aggravated by the dynamics of the generics/biosimilars markets whereby, after expiry of
patent/SPC protection of the reference medicine, only the first few generics/biosimilars to
enter the market capture a significant market share and are financially viable.

There is an urgent need to tackle this specific twofold problem, as the markets for generics
and biosimilars are highly competitive and steadily growing, with a significant number of

8 See M. Mejer, ‘ _25 years of SPC protection for medicinal products in Europe: Insights and challenges_ ’ (May
2017); and M. Kyle, _A study on the economic aspects of the SPC: ‘Economic Analysis of Supplementary_
_Protection Certificates in Europe_ ’ (2017).

9 SWD(2018)240, impact assessment accompanying this document, see section 6.3.1 and Annex 7.

10 The EU was a pioneer in the development of regulatory procedures to approve biosimilars. The European
Medicines Agency (EMA) authorised the first biosimilar in 2006: the US Food and Drug Administration
(FDA) did so only in 2015. Developing a biosimilar often requires investments in innovation of upwards of
EUR 250 million.

11 Whether they have their headquarters in the Union or in a non-EU country, and including
generics/biosimilars subsidiaries of innovative pharmaceutical companies.

12 At least if they are based in a country having no SPC protection (e.g. China, India, Brazil and Russia), or
having SPC _with a manufacturing waiver for export purposes_ (e.g. Canada), or countries such with shorter
SPC protection than in the EU (e.g. Israel).

# EN 3 EN

medicinal products entering the public domain – i.e. with the patents or the SPC coming to the
end of their term – in the coming years. This development will generate significant new
market opportunities for generics, and for biosimilars in particular.

Unless action is taken now, Europe risks missing the opportunities offered by this upcoming
‘patent cliff’, as the above unintended aspects of the current SPC regime act as a disincentive
for companies willing to invest in the new generics and biosimilars opportunities. If the
current legal barrier in Europe is maintained, companies wanting to produce generics or
biosimilars might start to manufacture outside the Union. The EU’s ‘pioneering’ competitive
advantage in the biosimilar sector might thus be lost and huge business opportunities
foregone, in particular as international trading partners are quickly catching up [13] .

To address the aforementioned problems, the proposal aims to introduce a manufacturing
waiver for export purposes. This waiver will remove the competitive disadvantages EU-based
manufacturers of generics and biosimilars are currently facing. It will allow them to
manufacture during the term of SPCs for the exclusive purpose of exporting their products to
non-EU markets where protection does not exist or has expired. This will also address, to a
certain extent, the EU _day-1_ entry issue: a manufacturer having set up a manufacturing line
for export purposes will easily be able, after SPC expiry, to use the same line to manufacture
generics or biosimilars with a view to swiftly supplying the EU market. Obviously, these
manufacturers would have to comply fully with the applicable pharmaceutical legislation and,
for instance, possess a valid marketing authorisation at the time the products are placed on the
EU market.

The proposal should contribute to Europe’s competitiveness as a hub for pharmaceutical R&D
and manufacturing. It will help new pharmaceutical companies start up and scale up in high
growth areas, and is projected to generate, over the next 10 years, additional net annual export
sales of well in excess of EUR 1 billion, which could translate into 20 000 to 25 000 new jobs
over that period. This is a conservative estimate, as it is calculated on the basis of a sample
representing about one third of innovative medicines [14] .

As the manufacturing capacity established for export purposes can, prior to the 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 generic and biosimilar
medicines to enter the market more quickly after the lapse of certificates, thus ensuring the
availability of a wider choice of affordable medicines once the period of patent and SPC
protection is over. This should have a positive effect on national health budgets.

This proposal will prove beneficial for firms that currently manufacture generics and
biosimilars in Europe. Over time, it will benefit the entire pharmaceutical sector in the Union,

13 For biosimilars, which are R&D-intensive, research tends to be located where manufacturing takes place:
relocation of manufacturing is therefore likely to lead to R&D being relocated as well. It is estimated that the
minimum cost of relocating the production of a single biological product is EUR 10 million and takes a
minimum of 1.5 to 2 years. Supporting investments in R&D and manufacturing in a pharmaceutical area
would have positive effects on the whole pharmaceutical sector in the EU. The Asia-Pacific region has more
biosimilars in development (led by China (269) and India (257)) than anywhere else in the world (the USA
has 187 under development). In 2012, South Korea invested 35% of its national medical R&D budget in
biosimilars development (see Deloitte’s _Winning with biosimilars-Opportunities in global markets_ (2015)).
Canada, while agreeing to introduce SPC protection as a result of the Comprehensive Economic Trade
Agreement (CETA) negotiations, nevertheless insisted on including an SPC manufacturing waiver (and other
limitations) in the agreement, so as to allow its own businesses to reap the benefits of the new generics and
biosimilar markets.

14 SWD(2018)240, impact assessment, sections 6 to 8.

# EN 4 EN

by allowing all players, including newcomers, to reap the benefits of the new opportunities
opening up in the fast-changing pharmaceutical market in Europe, and by strengthening the
pharmaceutical supply chain and ecosystem.

It is of course equally important to ensure that the Union remains an attractive place for those
that produce original medicines in Europe, and those that conduct research related to these
products.

Two points are worth highlighting in this context: First, this proposal leaves SPC protection
fully intact as regards placing products on the EU market. SPC holders will keep their market
exclusivity in Member States during the full SPC protection term. The proposal will foster
competition in non-EU markets where protection does not exist or has expired, but where
manufacturers of generics and biosimilars established in the EU would in future be able to
compete on an equal footing with manufacturers based in those non-EU countries.

Second, the proposal is accompanied by a series of safeguards to ensure transparency and
avoid the possible diversion onto the Union market of generics and biosimilars in respect of
which the original product is protected by an SPC. Businesses intending to start
manufacturing for export purposes will be under an obligation to notify the competent
authorities, and the information contained in that notification will be made public. They will
also have to comply with due diligence requirements, chiefly to prevent goods manufactured
for export from being diverted onto the Union market. Finally, any export of SPC-protected
products outside the Union will be subject to compliance with specific labelling requirements,
though any burden stemming from this will be outweighed by the benefits arising from the
exception.

The combined effect of these safeguard measures will create transparency and prevent
Intellectual Property (IP)-infringing products from entering Member State markets. It will
make it easier for both SPC holders and public authorities to detect and fight such
infringements, via the existing means of judicial redress offered under existing Intellectual
Property Rights (IPR) enforcement legislation (notably through injunctions) or other control
mechanisms such as market surveillance and customs control [15] .

**•** **Consistency with existing policies and measures**

The proposal is consistent with existing international trade agreements, such as the Agreement
on Trade-Related Aspects of Intellectual Property Rights (TRIPS) between members of the
World Trade Organization, as well as those free-trade agreements that the EU has concluded
with non-EU countries and that include supplementary protection-like provisions. It thus
complements the Union’s overall trade policy approach.

The proposal does not affect Directives 2001/83/EC [16] and 2001/82/EC [17] which lay down
harmonised conditions for industrially manufactured medicinal products for human and

15 In this respect, see also the Commission’s IP Package of 29.11.2017, which contained a holistic set of
measures to step up the fight against IPR infringements in the Union. This package was endorsed by the
Council on 12.3.2018.

16 Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the
Community code relating to medicinal products for human use (OJ L 311, 28.11.2001, p.67) .

17 Directive 2001/82/EC of the European Parliament and of the Council of 6 November 2001 on the
Community code relating to veterinary medicinal products (OJ L 311, 28.11.2001, p.1) .

# EN 5 EN

veterinary use, in particular the requirements related to the manufacturing authorisation of
medicinal products manufactured for export.

All rights and remedies under Union legislation that currently apply to the enforcement of
intellectual property rights in the Union (Directive 2004/48/EC [18] and Regulation (EU) No
608/2013 [19] ) would continue to apply to any product covered by the certificate where any act
carried out in relation to that product does not fall within the scope of the exception; these
rights and remedies would also apply to any product made pursuant to the exception but
illicitly diverted onto the Union market during the term of the certificate.

**•** **Consistency with other Union policies**

The Commission sees the protection of intellectual property as a key driver for promoting
innovation and creativity, which in turn generate jobs and improve competitiveness
worldwide. This is especially relevant for industry sectors whose products are subject to
regulated market authorisations, such as the pharmaceutical industry. As mentioned above,
the proposal does not affect in any way the market exclusivity that SPC holders enjoy in the
internal market during the SPC term.

SMEs are playing an increasing role throughout the value chain of the pharmaceutical
industry, including the manufacturing of generics and development of biosimilars. Such
SMEs can take special advantage of this proposal, since they have more difficulty starting up
and scaling up and cannot easily relocate production. Therefore, the proposal includes
transparency and anti-diversion measures, which have been carefully calibrated to avoid any
undue and disproportionate administrative burdens or costs for SMEs [20] and on business in
general.

As mentioned above, the proposal complements EU trade policy. It is not a protective
measure, as it only seeks to level the playing field between EU and non-EU manufacturers of
generics and biosimilars. It complements the efforts of the Union’s trade policy to ensure free
and fair trade, characterized by open markets, for Union-based manufacturers.

It is in line with the competition policy pursued by the Commission in relation to the entry of
generics directly after loss of market exclusivity (e.g. after SPC protection expires), as
reflected in the Commission’s 2009 Communication on the pharmaceutical sector inquiry [21]
and in subsequent competition enforcement decisions [22] . As already noted, a manufacturer
having set up a manufacturing line for export purposes will be able, after SPC expiry, to use
the same line to manufacture generics or biosimilars with a view to swiftly supplying the EU
market.

The 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 generics and biosimilars gain more rapid

18 Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of
intellectual property rights (OJ L157, 30.4.2004, p. 45).

19 Regulation (EU) No 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning
customs enforcement of intellectual property rights (OJ L 181, 29.6.2013, p. 15).

20 See SME test in Annex 16 of the impact assessment.

21 [http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/staff_working_paper_part1.pdf](http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/staff_working_paper_part1.pdf)

22 Commission Decisions in Case 39226 Lundbeck of 19.6.2013, in Case 39685 Fentanyl of 10.12.2013 and in
Case 39612 Perindopril (Servier) of 9.7.2014.

# EN 6 EN

entry into the Union market once the relevant certificates have lapsed. It will also diversify
the geographical origin of medicines available in the EU, thus strengthening the supply chain
and security of supply.

**2.** **LEGAL** **BASIS,** **SUBSIDIARITY** **AND** **PROPORTIONALITY**

**•** **Legal basis**

The sole legal basis for the proposal – as for Regulation (EC) No 469/2009, the legislative act
being amended – is Article 114 of the Treaty on the Functioning of the European Union. This
Article confers on the EU the competence to adopt measures on the establishment and
functioning of the internal market. Where an act such as Regulation (EC) No 469/2009 has
already removed the obstacles to trade in the area by harmonising the rules related to SPCs,
the Union is entitled to adapt that act to any change in circumstances or developments in the
relevant sector. In addition, although the proposal is aimed at the market conditions that apply
in non-EU markets, the actual manufacture under the exception will take place in the Union,
albeit exclusively for the purpose of export to non-EU markets.

**•** **Subsidiarity**

The proposal consists of an exception from the subject matter of protection of the certificate,
set out in Article 4 of Regulation (EC) No 469/2009. When a certificate takes effect, the SPC
confers the same rights as conferred by the basic patent and is subject to the same limitations
and obligations.

Only the Union can amend Regulation (EC) No 469/2009. While a Member State could
indirectly change the effects of SPC protection in its jurisdiction by changing the effects of its
national patents [23], those changes might take different forms from one Member State to
another, resulting in a distortion of the internal market for products protected by an SPC.
Therefore, only a proposal at EU level to amend Regulation (EC) No 469/2009 would prevent
a heterogeneous development of national rules and practices which directly affect the
functioning of the internal market.

The proposal aims to exempt from infringement of an SPC all the necessary acts related to
manufacturing for export purposes, which include upstream acts (e.g. supply of intermediary
products and active ingredients) and downstream acts (transport, storing, packaging, sorting
and the actual export). As these acts may be undertaken in different Member States where an
SPC is in force, an effective solution requires action at EU level.

Some voluntary agreements between generics/biosimilar manufacturers and originators have
been concluded at national level to facilitate entry onto the market of generics/biosimilars.
However, these did not properly address the objective of creating a level playing field for
generics/biosimilar manufacturers across the whole of the EU territory, nor did they address
the issue of export to non-EU countries. In general, as reflected in submissions to the public
consultation, these agreements are not considered successful and cannot therefore deal
adequately with the challenges and objectives described in the problem definition.

23 Any such change would however need to be in line with its international obligations, notably the TRIPS
Agreement.

# EN 7 EN

**•** **Proportionality**

The proposal has been designed to minimise the detrimental impact on SPC holders and the
administrative burden and compliance costs for generics/biosimilars manufacturers, while
ensuring equal treatment throughout the Union.

The proposal does not go beyond what it is necessary to tackle the identified problem. It
removes the barriers to the manufacture of generics and biosimilars in the Union for export.
The proposal is accompanied by non-cumbersome and inexpensive [24] measures in relation to
transparency and anti-diversion requirements, with a view to discouraging acts that would
interfere with the exclusivity that the SPC holder would continue to enjoy in the Union. These
measures would also facilitate enforcement against such acts.

The proposed Regulation will apply only to SPCs granted after its date of application, and
thus will not apply to any SPCs that have already been granted before that date. In this way,
this Regulation will not affect acquired property rights and the legitimate expectations of
holders of SPCs that have already been granted before the date of application of the
Regulation. This will provide clarity and legal certainty for all concerned. In addition, for
certain SPCs already granted, the holders may have made additional investment decisions
from the very outset (i.e. as and from the date of grant).

The new rules will also apply to applications for SPCs submitted to the competent authority
under Regulation (EC) No 469/2009, which remain pending on the date on which this
proposed Regulation enters into application. However, an appropriate transitional period will
apply to them.

**•** **Choice of the instrument**

In respect of the exception, a legislative solution is the only effective approach. The proposed
exception would be implemented by amending existing provisions of Regulation (EC) No
469/2009. Therefore, a Regulation rather than a Directive is the appropriate instrument.

**3.** **RESULTS** **OF** **EX-POST** **EVALUATIONS,** **STAKEHOLDER**
**CONSULTATIONS** **AND** **IMPACT** **ASSESSMENT**

The proposal is not presented as part of a general review of Regulation (EC) No 469/2009.
Rather, it is a targeted amendment to that Regulation and aims only to tackle the specific
problem identified.

In connection with the proposal, albeit not exclusively in that context, the Commission
contracted a number of independent studies to assess the legal and economic aspects of the
SPC system, along with the implementation aspects of the SPC Regulation. It has published
the findings from these studies [25] .

The Commission has also analysed the economic aspects of the SPC system in the EU
(collection and processing of statistics, links with direct foreign investment in the

24 With a view to the need not to burden SMEs.

25 _Assessing the economic impacts of changing exemption provisions during patent and SPC protection in_
_Europe_, by Charles River Associates, pub. 5.10.2017; _Economic Analysis of Supplementary_ Protection
_Certificates in Europe_, by Professor Kyle, pub. 12.10.2017; _Study on the legal aspects of the SPCs in the EU_,
by Max Planck Institute; and _Study on the economic impact of supplementary protection certificates,_
_pharmaceutical incentives and rewards in Europe_, by Copenhagen Economics. The final two studies are
being published in parallel with this proposal.

# EN 8 EN

pharmaceutical sector, etc.). An in-house analysis of the SPC regime in the EU was published
in May 2017 [26] .

Pharmaceutical companies have contracted several studies analysing the economic impact of
the proposal, which the Commission has looked at carefully as well.

In the impact assessment, all of these studies (contracted by the Commission and
pharmaceutical companies alike) have been analysed and their results carefully compared
with one another, as a basis for assessing the possible effects of the proposal on jobs and
growth in Europe.

The SPC regime as a whole is being looked at in the context of the wider pharmaceutical
incentives analysis requested by the Council in 2016 [27] . Some of the studies mentioned above
will feed into that exercise. The Commission also published a roadmap [28] on the upcoming
evaluation of the orphan and pediatric medicines legislation in 2018-2019.

**•** **Stakeholder consultations**

The Commission held an online public consultation [29] between 12 October 2017 and 4 January
2018 on the SPC-related issued addressed in the Single Market Strategy and in the subsequent
inception impact assessment of the EU SPC and the Bolar patent exemption. The consultation
included specific questions addressed to six categories of stakeholders: citizens, generics
companies/associations, originator companies/associations, patent practitioners/authorities,
health authorities/patient groups and trade/industry authorities. Some questions addressed
SME-specific aspects.

Generics/biosimilars manufacturers submitted 63 replies [30] . These were from individual
companies – 13 of them SMEs – as well as international, European and national associations.
They confirmed the problems identified in the inception impact assessment and the need, in
their view, for a manufacturing waiver, as they consider that a) the current SPC regime puts
them at a disadvantage compared with manufacturers based in countries without SPCs or with
shorter terms; b) introducing a waiver in the Union would increase their sales outside the
Union; and c) were a waiver put in place, they would increase their manufacturing in the EU.
Patient groups and health authorities also agreed with the problems identified.

72 respondents representing the interests of SPC holders (including 3 SMEs and 2 European
associations representing SMEs) participated in the consultation: most of them opposed a
waiver. In particular, they consider that a) the current SPC framework does not put EU-based
generics/biosimilars manufacturers at a disadvantage vis-à-vis foreign-based manufacturers;
b) introducing a waiver would erode intellectual property rights (IPR) protection and send a
negative message to innovators and investors, thus reducing R&D investment in the Union;
and c) a waiver would reduce their sales outside the EU.

In addition, in its study into the legal aspects of SPCs for the Commission, the Max Planck
Institute conducted a detailed consultation among pharmaceutical companies on the aspects

26 [https://ec.europa.eu/docsroom/documents/26001/attachments/1/translations/en/renditions/native, ‘](https://ec.europa.eu/docsroom/documents/26001/attachments/1/translations/en/renditions/native) _25 years of_

_SPC protection for medicinal products in Europe: Insights and challenges_ ’.

27 Council conclusions of 17.6.2016, referred to above.

28       https://ec.europa.eu/info/law/better [regulation/initiative/146293/attachment/090166e5b715e1dc_en](https://ec.europa.eu/info/law/better-regulation/initiative/146293/attachment/090166e5b715e1dc_en)

29 [https://ec.europa.eu/info/consultations/public-consultation-supplementary-protection-certificates-spcs-and-](https://ec.europa.eu/info/consultations/public-consultation-supplementary-protection-certificates-spcs-and-patent-research-exemptions_en)

[patent-research-exemptions_en](https://ec.europa.eu/info/consultations/public-consultation-supplementary-protection-certificates-spcs-and-patent-research-exemptions_en)

30 SWD(2018)242, Summary of the replies to the public consultation.

# EN 9 EN

related to the feasibility of an SPC manufacturing waiver, as well as preferred features for its
implementation (e.g. possible and preferred transparency and anti-diversion measures
accompanying a waiver).

The inputs provided in consultations and in meetings with industry were used to design and
enhance the transparency/anti-diversion measures of the proposal.

**•** **Collection and use of expertise**

As indicated above, the Max Planck Institute surveyed stakeholders on several aspects related
to the concept of an SPC waiver. In addition, it organised three workshops for experts and
representatives from industry, academia, the Commission, national patent offices, judges and
industrial property practitioners.

The Commission also participated in a number of workshops organised by several sectors of
the pharmaceutical industry (notably EuropaBio, EUCOPE, Medicines for Europe) in the
context of the preparation of the proposal and the Commission’s ongoing analysis of the
pharmaceutical incentives.

**•** **Impact assessment**

The proposal is accompanied by an impact assessment, which is consistent with the Opinion
of the Regulatory Scrutiny Board delivered on 9 March 2018 [31] .

The impact assessment looked at the issues raised by the existing EU regime concerning
SPCs. While the benefits of an SPC for its holder are significant, the SPC system, on foot of
significant changes in pharmaceutical markets, is now having unintended side effects on the
competitiveness of EU-based manufacturers of generics and/or biosimilars. Firstly, during the
SPC term, they cannot manufacture with a view to exporting generics and biosimilars to nonEU countries where protection does not exist or has expired. Secondly, upon SPC expiry, they
are not ready to place generics and biosimilars on the EU market. They thus forego significant
export opportunities and crucial lead-time to enter the market in Member States. This
stimulates a delocalisation of manufacturing of generics and biosimilars outside the Union, at
a time when new opportunities are opening up (i.e. due to the patent cliff from 2020 onwards),
and is having a negative impact on jobs, on patients (notably increased dependency and high
prices) and research for biosimilars.

The following possible options for resolving the problem were considered:

–
continuing with the status quo. This would not address the identified problems, with
negative consequences for manufacturers of generics and biosimilars, and, to some
extent, patients and national health systems;

–
the Commission, in collaboration with Member States, could try to facilitate further
voluntary agreements between generics/biosimilars manufacturers and originators,
consisting of allowing advance manufacturing of generics during the SPC term of the
reference medicine. The impact of this option would however be limited: such
agreements may be refused by the SPC holder of the reference medicine, may only
be adhered to by a few manufacturers of generics/biosimilars, or be subject to
dissuasive conditions (e.g. high financial compensation requested by the SPC
31 SEC(2018)246,Regulatory Scrutiny Board Opinion on the 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, delivered on 9.3.2018, accompanying this document. See Annex
1 of the impact assessment for an explanation of how the considerations of the Board were incorporated.

# EN 10 EN

holder). In addition, experience shows that comparable initiatives launched in some
Member States have not been very effective;

–
amending the EU SPC legislation, so as to allow EU-based manufacturers of generics
and biosimilars, during the SPC term of the reference medicine, to manufacture for
export and/or stockpiling purposes, possibly with anti-diversion measures.

In addition to the key options presented above, different scenarios on the ‘time-bound
applicability’ of the manufacturing waiver were analysed: SPC not yet applied for; SPC
applied for; SPC granted but not yet in effect since the basic patent is still in force; and SPC in
effect (i.e. after the basic patent has expired).

The **preferred option** is the introduction of a targeted and narrow exception from Regulation
(EC) No 469/2009. In line with the impact assessment, the comments of the Board and
feedback from stakeholders, the proposal reflects the following policy choices:

–
it introduces an exception, to enable manufacturers of generics and biosimilars to
manufacture such medicines for the purpose of exporting them outside the EU during
the SPC protection term;

–
this exception is accompanied by important ‘anti-diversion’ safeguards, notably a
requirement to notify, _ex ante_, such manufacturing to independent national public
bodies (which will hold the relevant information in a publicly accessible register)
along with labelling requirements for products that are exported and due diligence
requirements on the manufacturer vis-à-vis persons in its supply chain;

–
it makes the aforementioned exception subject to the following conditions: the
exception will apply only to SPCs that have not yet been granted, and only after a
transitional period to accommodate pending applications. This transition will allow
market players to take account of the new situation when making investment
decisions. It will also give national authorities enough time to set up their
arrangements for receiving notifications of the intention to make use of the
manufacturing waiver.

The preferred option boosts the competitiveness of EU-based generics and biosimilars
manufacturers in respect of exports during the SPC term (and, indirectly, favours their timely
entry onto the EU market upon SPC expiry). As mentioned above, this is expected to result in
net additional sales of EU-made pharmaceuticals of up to EUR 1 billion per year. This figure
is calculated on the basis of a limited sample covering only 32% of the relevant market, so the
actual benefit could well be much greater. The positive knock-on effects will be job creation,
estimated around 20 000 to 25 000 direct jobs, based on the same limited sample, and fewer
relocations.

The preferred option may cause a slight drop in the sales of products of SPC holders on export
markets, due to the increased competition they would face from EU-based generics and
biosimilars manufacturers during the SPC term in such ‘non-SPC’ non-EU countries. This
possible erosion of sales is estimated to be around 10 times lower than the estimated benefits
for EU-based generics and biosimilars manufacturers, and might occur in any event, due to
increasing competition from outside the Union [32] . In addition, robust safeguards are foreseen,

32 Generic gains in export markets for generic manufacturers are estimated to range between EUR 7.6 bn (CRA
study, 2017) and EUR 1.3bn (OHE study, 2018). The potential losses for SPC holders are estimated to range
between EUR 139m (CRA) and EUR 573m (OHE). See section 7 and Annex 12 of the impact assessment for
more details.

# EN 11 EN

limiting the scope for diverting SPC-infringing products onto the EU market during the period
of exclusivity.

The proposal would also be beneficial for the dynamism of the whole EU pharmaceutical
industrial ecosystem, as many SPC holders have outsourced branches of their activities to
non-EU countries, where these branches then develop generics and biosimilars.

The proposal has been carefully calibrated to avoid any undue and disproportionate
administrative burdens or costs for SMEs, particularly as regards the transparency and antidiversion measures [33] .

EU patients and health authorities would benefit from a strengthened and more timely supply
of medicines (e.g. in terms of diversification of the supply). An earlier Commission Staff
Working Document [34] revealed that while in the 1980s more than 80% of active
pharmaceutical ingredients (APIs) destined for the EU market were of European origin, by
2008 that figure had decreased to 20%. A significant majority of citizens who responded to
the public consultation – 32 out of 43 submissions – indicated that they care about the origin
of production of the medicines they consume. In addition, some of the submissions expressed
supply and quality concerns.

Additional savings to public spending in Member States on pharmaceuticals, potentially of the
order of upwards of 4% [35], could materialise from increased competition between generics and
biosimilars manufacturers in EU markets following SPC expiry in the Union.

Although the anti-diversion measures proposed will imply some administrative work, the
administrative or other implementation costs are limited and should be largely offset by the
benefits resulting from the proposal. No other costs (e.g. environmental costs) have been
identified.

**•** **Regulatory fitness and simplification**

As indicated above, this targeted proposal is not part of a general revision of Regulation (EC)
No 469/2009, since a wider pharmaceutical incentives analysis, as requested by the Council,
is currently ongoing. By introducing a manufacturing exception for export purposes, the
proposal aims at removing the competitive disadvantages that EU-based manufacturers of
generics and biosimilars are currently facing. Such measures have been carefully calibrated to
minimise costs on firms, and in particular SMEs, through a number of safeguards measures to
ensure transparency and possible diversion. In particular, an SME-test has been conducted.
The preferred option would be particularly beneficial for EU-based generics and biosimilars
SMEs, as it is more difficult for them to set up manufacturing facilities outside the EU. It will
create new opportunities for SMEs and start-ups in highly lucrative and fast-growing sectors,
in particular as regards biosimilars, which also invest intensively in R&D. At the same time, it
takes account of the interests of SMEs active in R&D for ‘original’ products, as it leaves the
core rights of SPC protection unaffected.

**•** **Fundamental rights**

The proposal fully respects fundamental rights and observes the rights, freedoms and
principles set out in the Charter of Fundamental Rights of the European Union, especially:

33 SME Test in Annex 16 of the impact assessment.

34 SWD(2014)216.

35 Charles River Associates study, p. 15.

# EN 12 EN

–
the right to property (Article 17) for SPC holders. The proposal will not affect the
market exclusivity of SPC holders in the EU, as it will only impact on non-EU
markets where protection does not exist or has expired. In addition, it includes
transparency/anti-diversion and due diligence measures, and it will not apply to SPCs
already granted, while, for pending applications, it will include an appropriate
transitional period;

–
access to health care (Article 35). The waiver will indirectly help make high quality
generics and biosimilars available more promptly in the EU after expiry of the
certificate, thereby making medicines more accessible to EU patients (especially in
Member States where access to biosimilars after _day-1_ may not be immediate). At
the same time, the original rationale for Regulation (EC) No 469/2009, which is to
ensure that research in innovative medicines does not relocate, would be maintained;

–
the freedom to conduct a business (Article 16) for EU-based generics and biosimilars
manufacturers.

**4.** **BUDGETARY** **IMPLICATIONS**

The proposal does not have implications for the Union budget.

**5.** **OTHER** **ELEMENTS**

After the entry into force of the Regulation, the Commission will monitor its implementation
with a view to assessing its effectiveness. The Regulation can be considered successful if it
promotes investment in manufacturing for export purposes of products covered by the
Regulation, and if it facilitates, to some extent, their timely entry onto the Union market after
the expiry of the certificate, without harming pharmaceutical R&D in the Union.

In this context, the Commission will monitor: (i) the number of EU generic and biosimilar
manufacturing sites producing products covered by the Regulation; (ii) the entry of EU
manufactured products in export markets for products covered by the Regulation as well as
sales dynamics and competition in these markets; (iii) the time of entry after expiry of the
certificate in Member States for products covered by Regulation; and (iv) R&D activities in
the EU by innovators and by generic and biosimilar companies. Indicators will be developed
using available data sources [36], minimising the need for reporting by biopharmaceutical
companies. Additional feedback on the functioning of the Regulation will be collected
through surveys.

An initial evaluation will take place not later than five years from the entry into force of the
Regulation, and implementation will be monitored every five years thereafter.

36 The available data sources include, but are not limited to, Eurostat, OECD, data provided on EMA website,
Eudra GMP, databases providing information on health markets and company level databases.

# EN 13 EN

2018/0161 (COD)

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**

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular
Article 114 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee [1],

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) Regulation (EC) No 469/2009 of the European Parliament and of the Council [2]
provides that any product protected by a patent in the territory of a Member State and
subject, prior to being placed on the market as a medicinal product, to an
administrative authorisation procedure as laid down in Directive 2001/83/EC of the
European Parliament and of the Council [3] or Directive 2001/82/EC of the European
Parliament and of the Council [4], may be the subject of a supplementary protection
certificate under the terms and conditions provided for in Regulation (EC) No
469/2009.

(2) By providing for a period of supplementary protection of up to five years, Regulation
(EC) No 469/2009 seeks to promote, within the Union, the research and innovation
that is necessary to develop medicinal products, and to contribute to preventing the
relocation of pharmaceutical research outside the Union to countries that may offer
greater protection.

(3) Since the adoption in 1992 of the predecessor to Regulation (EC) No 469/2009,
markets have evolved significantly and there has been huge growth in the manufacture

1 OJ C,, p. .

2 Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 concerning the
supplementary protection certificate for medicinal products (OJ L 152, 16.6.2009, p. 1).

3 Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the
Community code relating to medicinal products for human use (OJ L 311, 28.11.2001, p.67).

4 Directive 2001/82/EC of the European Parliament and of the Council of 6 November 2001 on the
Community code relating to veterinary medicinal products (OJ L 311, 28.11.2001, p. 1).

# EN 14 EN

of generics and especially of biosimilars, in particular in third countries where
protection does not exist or has expired.

(4) The absence of any exception in Regulation (EC) No 469/2009 to the protection
conferred by a supplementary protection certificate has had the unintended
consequence of preventing manufacturers of generics and biosimilars established in
the Union from manufacturing, even for the exclusive purpose of exporting to third
country markets in which such protection does not exist or has expired. A further
unintended consequence is that the protection conferred by the certificate makes it
more difficult for those manufacturers to enter the Union market immediately after
expiry of the certificate, given that they are not in a position to build up production
capacity until the protection provided by the certificate has lapsed, by contrast with
manufacturers located in third countries where protection does not exist or has expired.

(5) This puts manufacturers of generics and biosimilars established in the Union at a
significant competitive disadvantage compared with manufacturers based in third
countries that offer less or no protection.

(6) Without any intervention, the viability of the manufacture of generics and biosimilars
in the Union could be under threat, with consequences for the Union’s pharmaceutical
industrial base as a whole.

(7) The aim of this Regulation is to ensure that manufacturers established in the Union are
able to compete effectively in those third country markets where supplementary
protection does not exist or has expired. It is intended to complement the efforts of the
Union’s trade policy to ensure open markets for Union-based manufacturers of
medicinal products. Indirectly, it is also intended to put those manufacturers in a better
position to enter the Union market immediately after expiry of the relevant
supplementary protection certificate. It would also help to serve the aim of fostering
access to medicines in the Union by helping to ensure a swifter entry of generic and
biosimilar medicines onto the market after expiry of the relevant certificate.

(8) In those specific and limited circumstances, and in order to create a level playing field
between Union-based manufacturers and third country manufacturers, it is appropriate
to restrict the protection conferred by a supplementary protection certificate so as to
allow making for the exclusive purpose of export to third countries and any related
acts strictly necessary for making or for the actual export itself.

(9) That exception should cover the making of the product, including the product which
corresponds to the medicinal product protected by a supplementary protection
certificate in the territory of a Member State, for the exclusive purpose of export to
third countries, as well as any upstream or downstream acts by the maker or by third
parties in a contractual relationship with the maker, where such acts would otherwise
require the consent of the certificate-holder, and are strictly necessary for making for
the purpose of export or for the actual export itself. For instance, such acts may
include the supply and import of active ingredients for the purpose of making the
medicinal product to which the product covered by the certificate corresponds, or
temporary storage of the product or advertising for the exclusive purpose of export to
third country destinations.

(10) The exception should not cover placing the product made for the exclusive purpose of
export on the market in the Member State where a supplementary protection certificate
is in force, either directly or indirectly after export, nor should it cover re-importation
of the product to the market of a Member State in which a certificate is in force.

# EN 15 EN

Moreover, it should not cover any act or activity for the purpose of import of
medicinal products, or parts of medicinal products, into the Union merely for the
purposes of repackaging and re-exporting.

(11) By limiting the scope of the exception to making for the purpose of export outside the
Union and acts strictly necessary for such making or for the actual export itself, the
exception introduced by this Regulation will not unreasonably conflict with normal
exploitation of the product in the Member State where the certificate is in force, nor
unreasonably prejudice the legitimate interests of the certificate-holder, taking account
of the legitimate interests of third parties.

(12) Safeguards should accompany the exception in order to increase transparency, to help
the holder of a supplementary protection certificate to enforce its protection in the
Union and to reduce the risk of illicit diversion onto the Union market during the term
of the certificate.

(13) To this end, this Regulation should impose a once-off duty on the person making the
product for the exclusive purpose of export, requiring that person to provide certain
information to the authority which granted the supplementary protection certificate in
the Member State where the making is to take place. The information should be
provided before the making is intended to start for the first time in that Member State.
The making and related acts, including those performed in Member States other than
the one of making in cases where the product is protected by a certificate in those
other Member States too, should only fall within the scope of the exception where the
maker has sent this notification to the competent industrial property authority (or other
designated authority) of the Member State of making. The once-off duty to provide
information to the authority should apply in each Member State where making is to
take place, both as regards the making in that Member State, and as regards related
acts, whether performed in that or another Member State, related to that making. The
authority should be required to publish that information, in the interests of
transparency and for the purpose of informing the holder of the certificate of the
maker’s intention.

(14) In addition, this Regulation should impose certain due diligence requirements on the
maker as a condition for the exception to operate. The maker should be required to
inform persons within its supply chain, through appropriate means, in particular
contractual means, that the product is covered by the exception introduced by this
Regulation and is intended for the exclusive purpose of export. A maker who failed to
comply with these due diligence requirements would not benefit from the exception,
nor would any third party performing a related act in the same or a different Member
State where a certificate conferring protection for the product was in force, and the
holder of the relevant certificate would therefore be entitled to enforce its rights under
the certificate.

(15) Furthermore, this Regulation should impose labelling requirements on the maker, in
order to facilitate, by means of a logo, identification of the product as a product
exclusively intended for the purpose of export to third countries. The making and
related acts should only fall outside the protection conferred by a supplementary
protection certificate if the product is labelled in this manner. This labelling obligation
would be without prejudice to labelling requirements of third countries.

(16) Any act not covered by the exception introduced by this Regulation will remain within
the scope of the protection conferred by a supplementary protection certificate. This

# EN 16 EN

includes any product made within the terms of the exception and illicitly diverted onto
the Union market during the term of the certificate.

(17) This Regulation does not affect the application of Union measures that aim to prevent
infringements and facilitate enforcement of intellectual property rights, including
Directive 2004/48/EC of the European Parliament and of the Council [5] and Regulation
(EU) No 608/2013 of the European Parliament and of the Council [6] .

(18) This Regulation does not affect the application of Directives 2001/83/EC and
2001/82/EC, in particular the requirements related to the manufacturing authorisation
of medicinal products manufactured for export. This includes compliance with the
principles and guidelines of good manufacturing practices for medicinal products and
the use of active substances that have been manufactured in accordance with good
manufacturing practices for active substances and distributed in accordance with good
distribution practices for active substances.

(19) In order to ensure that holders of supplementary protection certificates already in force
are not deprived of their acquired rights, the exception provided for in this Regulation
should only apply to certificates that are granted on or after a specified date after entry
into force, irrespective of when the application for the certificate was first lodged. The
date specified should allow a reasonable time for applicants and other relevant market
players to adjust to the changed legal context and to make appropriate investment and
manufacturing location decisions in a timely way. The date should also allow
sufficient time for public authorities to put in place appropriate arrangements to
receive and publish notifications of the intention to make, and should take due account
of pending applications for certificates.

(20) The Commission should carry out an evaluation of this Regulation. Pursuant to
paragraph 22 of the Interinstitutional Agreement between the European Parliament, the
Council of the European Union and the European Commission on Better Law-Making
of 13 April 2016 [7], that evaluation should be based on the five criteria of effectiveness,
efficiency, relevance, coherence and added value and should provide the basis for
impact assessments of possible further measures. The evaluation should take into
account exports to outside the Union and the ability of generics and especially
biosimilars to enter markets in the Union as soon as possible after a certificate lapses.
In particular, this evaluation should review the effectiveness of the exception in the
light of the aim to restore a global level playing field for generic and biosimilar firms
in the Union and a swifter entry of generic and especially biosimilar medicines onto
the market after a certificate lapses. It should also study the impact of the exception on
research and production of innovative medicines by holders of certificates in the
Union and consider the balance between the different interests at stake, including those
of public health.

(21) It is necessary and appropriate for the achievement of the basic objective, of providing
a level playing field for generic and biosimilar manufacturers with their competitors in
third country markets where protection does not exist or has expired, to lay down rules

5 Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of
intellectual property rights (OJ L157, 30.4.2004, p. 45).

6 Regulation (EU) No 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning
customs enforcement of intellectual property rights (OJ L 181, 29.6.2013, p. 15).

7 OJ L 123, 12.5.2016, p. 1.

# EN 17 EN

restricting the exclusive right of a supplementary protection certificate holder to make
the product in question during the term of the certificate, and also to impose certain
information and labelling obligations on makers wishing to take advantage of those
rules _._ This Regulation complies with the principle of proportionality, and does not go
beyond what is necessary in order to achieve the objectives pursued, in accordance
with Article 5(4) of the Treaty on European Union.

(22) This Regulation respects fundamental rights and observes the principles recognised by
the Charter of Fundamental Rights of the European Union. In particular, this
Regulation seeks to ensure full respect for the right to property in Article 17 of the
Charter by maintaining the core rights of the supplementary protection certificate, by
confining the exception to certificates granted on or after a specified date after entry
into force of this Regulation and by imposing certain conditions on the application of
the exception,

HAVE ADOPTED THIS REGULATION:

_**Article 1 – Amendment of Regulation (EC) No**_ _**469/2009**_

Regulation (EC) No 469/2009 is amended as follows:

(1) Article 4 is replaced by the following:

_‘Article 4 – Subject matter of protection and exceptions to rights conferred_

1. Within the limits of the protection conferred by the basic patent, the protection
conferred by a certificate shall extend only to the product covered by the
authorisation to place the corresponding medicinal product on the market and for any
use of the product as a medicinal product that has been authorised before the expiry
of the certificate.

2. The certificate referred to in paragraph 1 shall not confer protection against a
particular act against which the basic patent conferred protection if, with respect to
that particular act, the following conditions are met:

(a) the act comprises:

(i) making for the exclusive purpose of export to third countries; or

(ii) any related act that is strictly necessary for that making or for
the actual export itself;

(b) the authority referred to in Article 9(1) of the Member State where that
making is to take place (‘the relevant Member State’) is notified by the
person doing the making (‘the maker’) of the information listed in
paragraph 3 no later than 28 days before the intended start date of
making in that Member State;

(c) the maker ensures that a logo, in the form set out in Annex -I, is affixed
to the outer packaging of the product or, if there is no outer packaging,
to its immediate packaging;

(d) the maker complies with the requirements of paragraph 4.

3. The information for the purposes of paragraph 2(b) shall be as follows:

(a) the name and address of the maker;

# EN 18 EN

(b) the address, or addresses, of the premises where the making is to take
place in the relevant Member State;

(c) the number of the certificate granted in the relevant Member State, and
identification of the product, by reference to the proprietary name used
by the holder of that certificate;

(d) the number of the authorisation granted in accordance with Article
40(1) of Directive 2001/83/EC or Article 44(1) of Directive
2001/82/EC for the manufacture of the corresponding medicinal
product or, in the absence of such authorisation, a valid certificate of
good manufacturing practice as referred to in Article 111(5) of
Directive 2001/83/EC or Article 80(5) of Directive 2001/82/EC
covering the premises where the making is to take place;

(e) the intended start date of making in the relevant Member State;

(f) an indicative list of the intended third country or third countries to
which the product is to be exported.

4. The maker shall ensure, through appropriate means, that persons in a contractual
relationship with the maker who perform acts falling within paragraph 2(a)(ii) are
fully informed and aware of the following:

(a) that those acts are subject to the provisions of paragraph 2;

(b) that the placing on the market, import or re-import of the product might
infringe the certificate referred to in that paragraph where, and as long
as, that certificate applies.

5. Paragraph 2 shall apply in the case only of certificates granted on or after [OP: please
insert the date of the first day of the third month that follows the month in which this
amending Regulation is published in the Official Journal)].’;

(2) in Article 11, the following paragraph is added:

4. ‘The notification sent to an authority as referred to in Article 4(2)(b) shall be
published by that authority within 15 days of receipt of the notification.’;

(3) the following Article is inserted:

_‘Article 21a – Evaluation_

No later than five years after the date referred to in Article 4(5), and every five years
thereafter, the Commission shall carry out an evaluation of Articles 4(2) to (4) and 11 and
present a report on the main findings to the European Parliament, the Council and the
European Economic and Social Committee.’;

(4) the Annex to this Regulation is inserted as Annex -I.

_**Article 2 – Entry into force**_

This Regulation shall enter into force on the twentieth day following that of its publication in
the _Official Journal of the European Union_ .

# EN 19 EN

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

_For the European Parliament_ _For the Council_
_The President_ _The President_

# EN 20 EN