Agreement On SPC Manufacturing Waiver Reached, Benefitting EU Generic, Biosimilar Industry

The European Council reached a political agreement today on the SPC Manufacturing Waiver, which will allow the manufacture of generic and biosimilar medicines in the European Union for export and stockpiling during the period of extended patent protection provided for by the EU. This waiver will enable EU generic and biosimilar industries to benefit from sales outside the EU where patents have already expired, and to prepare to provide the EU market as soon as the extended period of patent protection ends.

The political agreement reached by the Council today has maintained the original proposed SPC Manufacturing Waiver regulation along with its amendments, but has added stronger labeling and notification requirements for generics and biosimilars produced in the EU during the period of extended patent protection. These requirements are aimed to safeguard against the introduction of these medicines into EU markets before the period of extended patent protection ends.

“The Commission welcomes the political agreement reached by the European Parliament and Council on a targeted adjustment it proposed in May 2018 to intellectual property (IP) arrangements for pharmaceutical products,” according to a EU Commission press release.

“The agreement reached by the co-legislators is now subject to formal approval by the European Parliament and Council,” it said.

Supplementary protection certificates (SPCs) are an extended intellectual property right that aims “to offset the loss of effective patent protection for medicines that occurs due to the compulsory lengthy testing and clinical trials these products require prior to obtaining regulatory marketing approval. An SPC can extend a patent right for a maximum of five years,” according to a Commission press release on intellectual property rules.

The Romanian Presidency of the European Council tweeted about it:

Provisional agreement reached w/ @Europarl_EN on supplementary protection certificate for medicinal products. To be now submitted for endorsement by @EUCouncil #Coreper. pic.twitter.com/WnDcLLCfAp

— RO2019EU (@ro2019eu) February 14, 2019

Responses to the Agreement

“With this well-calibrated adjustment to intellectual property rules, we are helping Europe’s pharmaceutical companies tap into fast-growing global markets and foster jobs, growth and investments in the EU. We are removing a major competitive disadvantage of EU manufacturers who will soon be able to compete on equal terms on global markets where competition is fierce,” Elżbieta Bieńkowska, commissioner responsible for Internal Market, Industry, Entrepreneurship and SMEs [small and medium enterprises], said in the Commission release.

Medicines for Europe, an EU association of generic and biosimilar manufacturers, said it “thanks the EU for addressing many of its proposals for a comprehensive waiver including the possibility to manufacture for export and day 1 launch and a balanced date of applicability. The compromise foresees a review in five years, specifically of the day 1 launch duration, which provides us with an opportunity to assess its benefits,” according to a Medicines for Europe press release.

However, in response to the increased labeling and notification requirements included in the agreement, Medicines for Europe “calls on authorities to closely monitor any potential misuse of the notification system for frivolous litigation which could delay competition from generic and biosimilar manufacturers in markets where SPCs have expired,” it said.

The European Federation of Pharmaceutical Industries and Associations (EFPIA), which represents originator pharmaceutical companies, however, expressed concern over the agreement.

“EFPIA notes the gamble on Europe’s future in medical innovation taken by the EU institutions in today’s trilogue meeting on the SPC manufacturing waiver,” it said in a press release.

“If adopted in the final text, the amendments risk impacting on European patients living with unmet medical needs. They will significantly weaken Europe’s research and development offering risking investment and jobs from our SMEs, our companies, our academic institutions and our healthcare systems.”

Lead-up to the Negotiations on the SPC Manufacturing Waiver

The European Council and Parliament entered into negotiations on the SPC Manufacturing Waiver after it was introduced by the Commission in May 2018, and after Parliament proposed amendments extending the provisions of the waiver (IPW, Health & IP, 16 January 2019).

The original proposal included provisions to manufacture generics and biosimilars for export only, but the proposed amendments by Parliament extended these to include manufacturing to stockpile these medicines in the EU in preparation to supply EU markets on the first day (day 1) when the extended period of patent protection expires in the EU.

This regulation was described by the Commission as critical towards boosting the competitiveness of the EU generic and biosimilar industries in global markets, and the amendments were described by Parliament as essential for improving access to high quality and affordable medicines in the EU.

According to the Commission press release, the waiver “will support Europe’s pharmaceutical manufacturing base and Europe’s pioneering role in research and development of biosimilars. It is expected to generate extra growth of at least €1 billion per year in net additional export sales, creating up to 25,000 extra high-skilled jobs over 10 years.”

 

Image Credits: Medicines for Europe, European Council