Article 1 Definitions
For the purposes of this Regulation, the following definitions shall apply: (a) ‘medicinal product’ means any substance or combination of substances presented for treating or preventing disease in human beings or animals and any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in humans or in animals; (b) ‘product’ means the active ingredient or combination of active ingredients of a medicinal product; (c) ‘basic patent’ means a patent which protects a product as such, a process to obtain a product or an application of a product, and which is designated by its holder for the purpose of the procedure for grant of a certificate; (d) ‘certificate’ means the supplementary protection certificate; (e) ‘application for an extension of the duration’ means an application for an extension of the duration of the certificate pursuant to Article 13(3) of this Regulation and Article 36 of Regulation (EC) No 1901/2006 of the European Parliament and of the Council of 12 December 2006 on medicinal products for paediatric use ( 5 ).
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 1 Definitions):
For the purposes of this Regulation, the following definitions shall apply: (a) ‘medicinal product’ means any substance or combination of substances presented for treating or preventing disease in human beings or animals and any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in humans or in animals; (b) ‘product’ means the active ingredient or combination of active ingredients of a medicinal product; (c) ‘basic patent’ means a patent which protects a product as such, a process to obtain a product or an application of a product, and which is designated by its holder for the purpose of the procedure for grant of a certificate; (d) ‘certificate’ means the supplementary protection certificate; (f) ‘maker’ means the person, established in the Union, on whose behalf the making of a product, or a medicinal product containing that product, for the purpose of export to third countries or for the purpose of storing, is carried out.
Article 2 Scope
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 of 6 November 2001 on the Community code relating to medicinal products for human use ( 6 ) or 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 ( 7 ) may, under the terms and conditions provided for in this Regulation, be the subject of a certificate.
Article 3 Conditions for obtaining a certificate
A certificate shall be granted if, in the Member State in which the application referred to in Article 7 is submitted and at the date of that application: (a) the product is protected by a basic patent in force; (b) a valid authorisation to place the product on the market as a medicinal product has been granted in accordance with Directive 2001/83/EC or Directive 2001/82/EC, as appropriate; (c) the product has not already been the subject of a certificate; (d) the authorisation referred to in point (b) is the first authorisation to place the product on the market as a medicinal product.
Article 4 Subject matter of protection
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.
Article 5 Effects of the certificate
Subject to the provisions of Article 4, the certificate shall confer the same rights as conferred by the basic patent and shall be subject to the same limitations and the same obligations.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 5 Effects of the certificate):
1. Subject to the provisions of Article 4, the certificate shall confer the same rights as conferred by the basic patent and shall be subject to the same limitations and the same obligations. 3. The exception referred to in paragraph 2 shall not apply to any act or activity carried out for the import of products, or medicinal products containing those products, into the Union merely for the purpose of repackaging, re-exporting or storing. 4. The information provided to the certificate holder for the purposes of points (b) and (c) of paragraph 2 shall be used exclusively for the purposes of verifying whether the requirements of this Regulation have been met and, where applicable, initiating legal proceedings for non-compliance. 6. For the purposes of notification to the authority under points (b) and (c) of paragraph 2, the maker shall use the standard form for notification contained in Annex -Ia. 7. Failure to comply with the requirements of point (e) of paragraph 5 with regard to a third country shall only affect exports to that country, and those exports shall, therefore, not benefit from the exception. 10. Paragraph 2 shall apply to certificates that are applied for on or after 1 July 2019. Paragraph 2 shall also apply to certificates that have been applied for before 1 July 2019 and that take effect on or after that date. Paragraph 2 shall only apply to such certificates from 2 July 2022. Paragraph 2 shall not apply to certificates that take effect before 1 July 2019.
Article 6 Entitlement to the certificate
The certificate shall be granted to the holder of the basic patent or his successor in title.
Article 7 Application for a certificate
1. The application for a certificate shall be lodged within six months of the date on which the authorisation referred to in Article 3(b) to place the product on the market as a medicinal product was granted. 2. Notwithstanding paragraph 1, where the authorisation to place the product on the market is granted before the basic patent is granted, the application for a certificate shall be lodged within six months of the date on which the patent is granted. 3. The application for an extension of the duration may be made when lodging the application for a certificate or when the application for the certificate is pending and the appropriate requirements of Article 8(1)(d) or Article 8(2), respectively, are fulfilled. 4. The application for an extension of the duration of a certificate already granted shall be lodged not later than two years before the expiry of the certificate. 5. Notwithstanding paragraph 4, for five years following the entry into force of Regulation (EC) No 1901/2006, the application for an extension of the duration of a certificate already granted shall be lodged not later than six months before the expiry of the certificate.
Article 8 Content of the application for a certificate
1. The application for a certificate shall contain: (a) a request for the grant of a certificate, stating in particular: (i) the name and address of the applicant; (ii) if he has appointed a representative, the name and address of the representative; (iii) the number of the basic patent and the title of the invention; (iv) the number and date of the first authorisation to place the product on the market, as referred to in Article 3(b) and, if this authorisation is not the first authorisation for placing the product on the market in the Community, the number and date of that authorisation; (a) a request for the grant of a certificate, stating in particular: (i) the name and address of the applicant; (ii) if he has appointed a representative, the name and address of the representative; (iii) the number of the basic patent and the title of the invention; (iv) the number and date of the first authorisation to place the product on the market, as referred to in Article 3(b) and, if this authorisation is not the first authorisation for placing the product on the market in the Community, the number and date of that authorisation; (b) a copy of the authorisation to place the product on the market, as referred to in Article 3(b), in which the product is identified, containing in particular the number and date of the authorisation and the summary of the product characteristics listed in Article 11 of Directive 2001/83/EC or Article 14 of Directive 2001/82/EC; (c) if the authorisation referred to in point (b) is not the first authorisation for placing the product on the market as a medicinal product in the Community, information regarding the identity of the product thus authorised and the legal provision under which the authorisation procedure took place, together with a copy of the notice publishing the authorisation in the appropriate official publication; (d) where the application for a certificate includes a request for an extension of the duration: (i) a copy of the statement indicating compliance with an agreed completed paediatric investigation plan as referred to in Article 36(1) of Regulation (EC) No 1901/2006; (ii) where necessary, in addition to the copy of the authorisation to place the product on the market as referred to in point (b), proof of possession of authorisations to place the product on the market of all other Member States, as referred to in Article 36(3) of Regulation (EC) No 1901/2006. (d) where the application for a certificate includes a request for an extension of the duration: (i) a copy of the statement indicating compliance with an agreed completed paediatric investigation plan as referred to in Article 36(1) of Regulation (EC) No 1901/2006; (ii) where necessary, in addition to the copy of the authorisation to place the product on the market as referred to in point (b), proof of possession of authorisations to place the product on the market of all other Member States, as referred to in Article 36(3) of Regulation (EC) No 1901/2006. 2. Where an application for a certificate is pending, an application for an extended duration in accordance with Article 7(3) shall include the particulars referred to in paragraph 1(d) of this Article and a reference to the application for a certificate already filed. 3. The application for an extension of the duration of a certificate already granted shall contain the particulars referred to in paragraph 1(d) and a copy of the certificate already granted. 4. Member States may provide that a fee is to be payable upon application for a certificate and upon application for the extension of the duration of a certificate.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 8 Content of the application for a certificate):
2. Where an application for a certificate is pending, an application for an extended duration in accordance with Article 7(3) shall include the particulars referred to in paragraph 1(d) of this Article and a reference to the application for a certificate already filed. 3. The application for an extension of the duration of a certificate already granted shall contain the particulars referred to in paragraph 1(d) and a copy of the certificate already granted. 4. Member States may provide that a fee is to be payable upon application for a certificate and upon application for the extension of the duration of a certificate.
Article 9 Lodging of an application for a certificate
1. The application for a certificate shall be lodged with the competent industrial property office of the Member State which granted the basic patent or on whose behalf it was granted and in which the authorisation referred to in Article 3(b) to place the product on the market was obtained, unless the Member State designates another authority for the purpose. The application for an extension of the duration of a certificate shall be lodged with the competent authority of the Member State concerned. 2. Notification of the application for a certificate shall be published by the authority referred to in paragraph 1. The notification shall contain at least the following information: (a) the name and address of the applicant; (b) the number of the basic patent; (c) the title of the invention; (d) the number and date of the authorisation to place the product on the market, referred to in Article 3(b), and the product identified in that authorisation; (e) where relevant, the number and date of the first authorisation to place the product on the market in the Community; (f) where applicable, an indication that the application includes an application for an extension of the duration. 3. Paragraph 2 shall apply to the notification of the application for an extension of the duration of a certificate already granted or where an application for a certificate is pending. The notification shall additionally contain an indication of the application for an extended duration of the certificate.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 9 Lodging of an application for a certificate):
1. The application for a certificate shall be lodged with the competent industrial property office of the Member State which granted the basic patent or on whose behalf it was granted and in which the authorisation referred to in Article 3(b) to place the product on the market was obtained, unless the Member State designates another authority for the purpose. The application for an extension of the duration of a certificate shall be lodged with the competent authority of the Member State concerned. 3. Paragraph 2 shall apply to the notification of the application for an extension of the duration of a certificate already granted or where an application for a certificate is pending. The notification shall additionally contain an indication of the application for an extended duration of the certificate.
Article 10 Grant of the certificate or rejection of the application for a certificate
1. Where the application for a certificate and the product to which it relates meet the conditions laid down in this Regulation, the authority referred to in Article 9(1) shall grant the certificate. 2. The authority referred to in Article 9(1) shall, subject to paragraph 3, reject the application for a certificate if the application or the product to which it relates does not meet the conditions laid down in this Regulation. 3. Where the application for a certificate does not meet the conditions laid down in Article 8, the authority referred to in Article 9(1) shall ask the applicant to rectify the irregularity, or to settle the fee, within a stated time. 4. If the irregularity is not rectified or the fee is not settled under paragraph 3 within the stated time, the authority shall reject the application. 5. Member States may provide that the authority referred to in Article 9(1) is to grant certificates without verifying that the conditions laid down in Article 3(c) and (d) are met. 6. Paragraphs 1 to 4 shall apply mutatis mutandis to the application for an extension of the duration.
Article 11 Publication
1. Notification of the fact that a certificate has been granted shall be published by the authority referred to in Article 9(1). The notification shall contain at least the following information: (a) the name and address of the holder of the certificate; (b) the number of the basic patent; (c) the title of the invention; (d) the number and date of the authorisation to place the product on the market referred to in Article 3(b) and the product identified in that authorisation; (e) where relevant, the number and date of the first authorisation to place the product on the market in the Community; (f) the duration of the certificate. 2. Notification of the fact that the application for a certificate has been rejected shall be published by the authority referred to in Article 9(1). The notification shall contain at least the information listed in Article 9(2). 3. Paragraphs 1 and 2 shall apply to the notification of the fact that an extension of the duration of a certificate has been granted or of the fact that the application for an extension has been rejected.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 11 Publication):
2. Notification of the fact that the application for a certificate has been rejected shall be published by the authority referred to in Article 9(1). The notification shall contain at least the information listed in Article 9(2). 3. Paragraphs 1 and 2 shall apply to the notification of the fact that an extension of the duration of a certificate has been granted or of the fact that the application for an extension has been rejected. 4. The authority referred to in Article 9(1) shall publish, as soon as possible, the information listed in Article 5(5), together with the date of notification of that information. It shall also publish, as soon as possible, any changes to the information notified in accordance with point (c) of Article 5(2).
Article 12 Annual fees
Member States may require that the certificate be subject to the payment of annual fees.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 12 Fees):
1. Member States may require that the certificate be subject to the payment of annual fees. 2. Member States may require that the notifications referred to in points (b) and (c) of Article 5(2) be subject to the payment of a fee.
Article 13 Duration of the certificate
1. The certificate shall take effect at the end of the lawful term of the basic patent for a period equal to the period which elapsed between the date on which the application for a basic patent was lodged and the date of the first authorisation to place the product on the market in the Community, reduced by a period of five years. 2. Notwithstanding paragraph 1, the duration of the certificate may not exceed five years from the date on which it takes effect. 3. The periods laid down in paragraphs 1 and 2 shall be extended by six months in the case where Article 36 of Regulation (EC) No 1901/2006 applies. In that case, the duration of the period laid down in paragraph 1 of this Article may be extended only once. 4. Where a certificate is granted for a product protected by a patent which, before 2 January 1993, had its term extended or for which such extension was applied for, under national law, the term of protection to be afforded under this certificate shall be reduced by the number of years by which the term of the patent exceeds 20 years.
Article 14 Expiry of the certificate
The certificate shall lapse: (a) at the end of the period provided for in Article 13; (b) if the certificate holder surrenders it; (c) if the annual fee laid down in accordance with Article 12 is not paid in time; (d) if and as long as the product covered by the certificate may no longer be placed on the market following the withdrawal of the appropriate authorisation or authorisations to place on the market in accordance with Directive 2001/83/EC or Directive 2001/82/EC. The authority referred to in Article 9(1) of this Regulation may decide on the lapse of the certificate either of its own motion or at the request of a third party.
Article 15 Invalidity of the certificate
1. The certificate shall be invalid if: (a) it was granted contrary to the provisions of Article 3; (b) the basic patent has lapsed before its lawful term expires; (c) the basic patent is revoked or limited to the extent that the product for which the certificate was granted would no longer be protected by the claims of the basic patent or, after the basic patent has expired, grounds for revocation exist which would have justified such revocation or limitation. 2. Any person may submit an application or bring an action for a declaration of invalidity of the certificate before the body responsible under national law for the revocation of the corresponding basic patent.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 15 Invalidity of the certificate):
2. Any person may submit an application or bring an action for a declaration of invalidity of the certificate before the body responsible under national law for the revocation of the corresponding basic patent.
Article 16 Revocation of an extension of the duration
1. The extension of the duration may be revoked if it was granted contrary to the provisions of Article 36 of Regulation (EC) No 1901/2006. 2. Any person may submit an application for revocation of the extension of the duration to the body responsible under national law for the revocation of the corresponding basic patent.
Article 17 Notification of lapse or invalidity
1. If the certificate lapses in accordance with point (b), (c) or (d) of Article 14, or is invalid in accordance with Article 15, notification thereof shall be published by the authority referred to in Article 9(1). 2. If the extension of the duration is revoked in accordance with Article 16, notification thereof shall be published by the authority referred to in Article 9(1).
Article 18 Appeals
The decisions of the authority referred to in Article 9(1) or of the bodies referred to in Articles 15(2) and 16(2) taken under this Regulation shall be open to the same appeals as those provided for in national law against similar decisions taken in respect of national patents.
Article 19 Procedure
1. In the absence of procedural provisions in this Regulation, the procedural provisions applicable under national law to the corresponding basic patent shall apply to the certificate, unless the national law lays down special procedural provisions for certificates. 2. Notwithstanding paragraph 1, the procedure for opposition to the granting of a certificate shall be excluded.
Article 20 Additional provisions relating to the enlargement of the Community
Without prejudice to the other provisions of this Regulation, the following provisions shall apply: (a) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Bulgaria, provided that the application for a certificate was lodged within six months from 1 January 2007; (b) any medicinal product protected by a valid basic patent in the Czech Republic and for which the first authorisation to place it on the market as a medicinal product was obtained: (i) in the Czech Republic after 10 November 1999 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; (ii) in the Community not earlier than six months prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; (b) any medicinal product protected by a valid basic patent in the Czech Republic and for which the first authorisation to place it on the market as a medicinal product was obtained: (i) in the Czech Republic after 10 November 1999 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; (ii) in the Community not earlier than six months prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; (c) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Estonia prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained or, in the case of those patents granted prior to 1 January 2000, within the six months provided for in the Patents Act of October 1999; (d) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Cyprus prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; notwithstanding the above, where the market authorisation was obtained before the grant of the basic patent, the application for a certificate must be lodged within six months of the date on which the patent was granted; (e) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Latvia prior to 1 May 2004 may be granted a certificate. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 May 2004; (f) any medicinal product protected by a valid basic patent applied for after 1 February 1994 and for which the first authorisation to place it on the market as a medicinal product was obtained in Lithuania prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months from 1 May 2004; (g) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Hungary, provided that the application for a certificate was lodged within six months from 1 May 2004; (h) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Malta prior to 1 May 2004 may be granted a certificate. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 May 2004; (i) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Poland, provided that the application for a certificate was lodged within six months starting no later than 1 May 2004; (j) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Romania. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 January 2007; (k) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Slovenia prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months from 1 May 2004, including in cases where the period provided for in Article 7(1) has expired; (l) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Slovakia after 1 January 2000 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained or within six months of 1 July 2002 if the market authorisation was obtained before that date; (m) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2003 may be granted a certificate in Croatia, provided that the application for a certificate is lodged within six months from the date of accession.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 20 Additional provisions relating to the enlargement of the Community):
Without prejudice to the other provisions of this Regulation, the following provisions shall apply: (a) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Bulgaria, provided that the application for a certificate was lodged within six months from 1 January 2007; (c) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Estonia prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained or, in the case of those patents granted prior to 1 January 2000, within the six months provided for in the Patents Act of October 1999; (d) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Cyprus prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained; notwithstanding the above, where the market authorisation was obtained before the grant of the basic patent, the application for a certificate must be lodged within six months of the date on which the patent was granted; (e) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Latvia prior to 1 May 2004 may be granted a certificate. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 May 2004; (f) any medicinal product protected by a valid basic patent applied for after 1 February 1994 and for which the first authorisation to place it on the market as a medicinal product was obtained in Lithuania prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months from 1 May 2004; (g) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Hungary, provided that the application for a certificate was lodged within six months from 1 May 2004; (h) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Malta prior to 1 May 2004 may be granted a certificate. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 May 2004; (i) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Poland, provided that the application for a certificate was lodged within six months starting no later than 1 May 2004; (j) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2000 may be granted a certificate in Romania. In cases where the period provided for in Article 7(1) has expired, the possibility of applying for a certificate shall be open for a period of six months starting no later than 1 January 2007; (k) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Slovenia prior to 1 May 2004 may be granted a certificate, provided that the application for a certificate was lodged within six months from 1 May 2004, including in cases where the period provided for in Article 7(1) has expired; (l) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained in Slovakia after 1 January 2000 may be granted a certificate, provided that the application for a certificate was lodged within six months of the date on which the first market authorisation was obtained or within six months of 1 July 2002 if the market authorisation was obtained before that date; (m) any medicinal product protected by a valid basic patent and for which the first authorisation to place it on the market as a medicinal product was obtained after 1 January 2003 may be granted a certificate in Croatia, provided that the application for a certificate is lodged within six months from the date of accession.
Article 21 Transitional provisions
1. This Regulation shall not apply to certificates granted in accordance with the national legislation of a Member State before 2 January 1993 or to applications for a certificate filed in accordance with that legislation before 2 July 1992. With regard to Austria, Finland and Sweden, this Regulation shall not apply to certificates granted in accordance with their national legislation before 1 January 1995. 2. This Regulation shall apply to supplementary protection certificates granted in accordance with the national legislation of the Czech Republic, Estonia, Croatia, Cyprus, Latvia, Lithuania, Malta, Poland, Romania, Slovenia and Slovakia prior to their respective date of accession.
Article 22 Repeal
Regulation (EEC) No 1768/92, as amended by the acts listed in Annex I, is repealed. References to the repealed Regulation shall be construed as references to this Regulation and shall be read in accordance with the correlation table in Annex II.
Article 23 Entry into force
This Regulation shall enter into force on the 20th day following its publication in the Official Journal of the European Union . This Regulation shall be binding in its entirety and directly applicable in all Member States.
Amendment rationale: 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 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. 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 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, 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 
Revised version (Article 23 Entry into force):
This Regulation shall enter into force on the 20th day following its publication in the Official Journal of the European Union .