EU Commission - pharmaceutical sector inquiry
The recently published preliminary report into the pharmaceutical sector by the European Commission’s DG Competition has highlighted what it referred to as a tool kit of measures used by the originator branded sector to delay or block market entry of generic medicines. The Commission referred to practices including:
- Confusing multiple patent applications
- The initiation of disputes and litigation
- Tactics to switch patients to second generation products with little or no therapeutic benefit.
The Commission’s report is consistent with BGMA members’ experience. Increased focus by originator companies on delaying or blocking generic market entry means that:
- The NHS will pay more for medicines, reducing the money available to support true research and innovation
- There is less incentive for innovation due to the lack of generic competition, potentially denying patients the development of truly new medicines and treatments that they need.
The activities of the originators to delay or avoid generic competition damages the generic industry, the NHS, and innovation itself. It is crucial that the competition authorities ensure that the operation of the market reverts to what was intended: that originators receive long periods of market monopoly on their products during the patent term so that they can recoup their research investment, followed by the immediate onset of generic competition to make medicines affordable and to promote true innovation.
We believe that competition law may be breached when an originator makes applications for patents which it knows, or ought reasonably to know, should not be granted; or where it deliberately withholds evidence from the examiner that it knows, or ought reasonably to know, is relevant to the application and may result in it not being granted.
But competition law will not, of itself, resolve all of the problems associated with the granting of weak patents and their proliferation. It is simply too easy to obtain weak patents through the EPO and national patent agencies. Action should be taken to “raise the bar” in terms of the quality and thoroughness of the assessment of patent applications. This should not be taken to imply that we necessarily seek a change in the fundamental rules: rather, we seek to avoid poor decisions brought about by the lack of time and information available to the examiner.
Specifically, we propose that:
- There should be a more rigorous assessment of patentability requirements, particularly the application of the inventive step requirement.
- Applications for divisional patents should not cover essentially the same subject matter as the parent application.
Calls for enhanced intellectual property to address the concern that more new chemical entities are now developed in the US than the EU are wrong minded. Generic competition drives innovation. The originator sector enjoys lower levels of intellectual property and similar protection in the US than in the EU. For example, in the US, patent term extension extends to 14 years: in the EU, to 15 years; data exclusivity is at 5+3 years in the US: and 8+2+1 years in the EU.
