Getting to market
When a drug becomes off-patent, competition from generic manufacturers is a very efficient way of driving down prices and increasing savings potential for the NHS as well as delivering innovation through offering competition to patent expired brands. However, there can be a number of barriers which prevent generic competition. As an industry, we face risks to our ability to launch at patent expiry due to activities of the originator sector some of which may be characterised as unfair competition. These include the abuse of patents. A European Commission Sector Inquiry report from 2009 said that applications to the European Patent Office (EPO) nearly doubled between 2000 and 2007.
The Commission acknowledged that the increase was partly due to 'defensive patent strategies' with the objective of 'delaying or blocking entry of generic medicines'. This included the use of patent clusters or thickets where multiple applications were filed around a single product in order to confuse actual current patent status.
We are concerned that the use of patent, or similar extensions of exclusivity, by legislators to drive industry behaviour can backfire. An example is the so-called “paediatric extension” which grants six months additional exclusivity in return for carrying out a paediatric investigation plan. These additional periods of exclusivity can cost the NHS enormous amounts of money when the actual number of new beneficiaries may be small in comparison and the research relatively low-cost. For example, Pfizer was recently granted an additional six months effective patent protection for its best-selling drug Lipitor. We estimate this would cost the NHS, and the UK taxpayer, an additional £150million for a relatively low-cost piece of research to establish the benefit.
We believe it is morally right that paediatric uses of medicines should be researched and licensed. We do not object to there being a financial incentive, if one is needed, to encourage companies to do this work. However, it just seems that high returns on such comparatively low investment are beyond all reasonable scale and proportionality.