The UK Government has just announced a proposal to change UK patent law to exempt clinical trials of innovative drugs, for both regulatory approval and health technology assessments, from patent infringement.  This is welcome news for the pharmaceutical industry as it finally clarifies the scope of this exemption, and the new, more liberal provisions could lead to more clinical trials of experimental drugs being carried out in the UK. The question of whether research into a patented drug infringes the patent has been a controversial one in the UK for many years.  Section 60(5) of the UK Patents Act generally exempts experimental use of a patented invention from infringement.  However, the 1985 UK Court of Appeal decision in Monsanto v Stauffer limited the scope of this experimental use defence to acts carried out to find out something unknown about the patented product (for example, a new use), and did not cover acts carried out to demonstrate to a third party (such as a regulatory authority) that the product works.  Although this case related to field trials of a plant protection product, the general wording of the ruling meant it also applied to trials of pharmaceutical products.  As this decision has never been overruled by a higher UK Court, this strict interpretation of the exemption has put the UK out of step with other EU countries, notably Germany, which exempted some clinical trials from patent infringement. To attempt to harmonise EU law on this matter, a 2004 EU Directive required Member States to exempt from infringement trials of a patented, marketed pharmaceutical for the purposes of obtaining regulatory approval of a generic version to be marketed after the patent expired.  This Directive is commonly referred to as the "EU Bolar Directive", after the corresponding provision in US law which exempts acts required to gain regulatory approval of a pharmaceutical by the FDA from patent infringement.  However, EU Directives are binding only as to the result to be achieved, and Member States have some degree of freedom as to the way they are implemented.  In this case, while some other EU countries implemented the EU Bolar Directive broadly to exempt all clinical trials of both innovative and generic pharmaceuticals from patent infringement, the UK implemented it narrowly and applied it only to trials of generic drugs. 

The combined effects of the above provisions have meant it has long been uncertain whether clinical trials of patented, innovative medicines in the UK constitute patent infringement.  A particular issue arises when the pharmaceutical regulatory authorities or health technology assessors require an innovative drug to be tested against a comparator drug already on the market – if the comparator is patented, the patent could be infringed under the current legislation.  This has prompted concerns that companies are being forced to carry out clinical trials elsewhere to avoid the legal uncertainty on infringement and therefore driving pharmaceutical research out of the UK. 

In response to these concerns, the UK Government launched a public consultation in October 2012 – the results of that consultation have just been published.  The Government has accepted the need to change UK patent law to exempt from patent infringement activities involved in preparing or running clinical trials involving innovative drugs for the purpose of gaining regulatory approval in any country.  It has also accepted that the proposed exemption should also apply to activities involved in health technology assessments, such as those carried out by the UK National Institute for Health and Clinical Excellence (NICE), which is the authority which decides whether the UK National Health Service pays for an approved drug.  The Government therefore plans to amend the UK Patents Act to explicitly exempt these activities from infringement. A summary of how the proposed law changes will affect trials is set out below.  It is noted that the proposed changes will not apply to plant protection products, so Monsanto v Stauffer will still prohibit all UK field trials of such products for regulatory review.

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The new exemptions will be carried out by a regulatory reform order, so may come into force within the next few months.  However, the exact terms of the exemption have not yet been clarified.  In particular, the consultation results do not make it clear how broad the scope of the term "activities" will be: it remains to be seen whether the exemption would only apply if one company both made and tested the patented drug, or whether a third party could supply the testing company with the drug and itself avoid infringement (a 2012 decision by the Düsseldorf District Court ruled that the third party would infringe in this case).  We will provide an update as soon as further details of the new legislation are announced.