In its recent report on the Single Market (‘Upgrading the Single Market: more opportunities for people and business’, COM (2015) 550 final), the European Commission highlighted the need to address uncertainties over how the upcoming Unitary Patent will work together with national supplementary protection certificates (‘SPC’) granted under the SPC regime and the possible creation of a unitary SPC. Following on from this, the European Commission has announced a tender for a pan-EU study of the SPC regime, including recommendations for reform. Typically, these types of studies are used by the European Commission as the basis for legislative proposals.


SPCs and unitary patents

The lengthy negotiations in recent years over the creation of a Unitary Patent in the EU left for another day consideration of the interaction between Unitary Patents and supplementary protection certificates. As a result, many uncertainties remain.

For example, it is not clear that the current SPC Regulations (Regulation 469/2009/EC concerning the supplementary protection certificate for medicinal products and Regulation 1610/96/EC concerning the supplementary protection certificate for plant protection products) allow national SPCs to be granted on the basis of a unitary patent. Most commentators believe that, on balance, the wording of the SPC Regulation can be interpreted to allow this. However, given the commercial importance of SPCs to the pharmaceutical and plant protection/agrochemical industries, even a small risk that this may not be the case is a significant disincentive from requesting unitary effect for a European patent. Indeed, without clarification, this uncertainty may cause the life sciences sector to avoid unitary patents completely.

Another issue is that SPCs are currently national rights. This results in a territorially fragmented system, which is at odds with current trends towards the creation of pan-EU unitary intellectual property rights. In light of the upcoming launch of the Unitary Patent system, the Commission is asking whether a unitary SPC covering the territory of the whole EU (or at least the 25 EU member states which will be covered by the Unitary Patent system (the ‘EU-25’)) should also be created? If so, this will require new legislation. Moreover, it is not simply a case of adapting the current SPC Regulations to provide for a unitary SPC. Detailed thought will need to be given to how a unitary SPC will interact with the regulatory system in the EU for human medicinal products, veterinary products and plant protection products. For example, will a single national marketing authorisation be enough to justify the grant of a unitary SPC on the basis of a unitary patent? Or will a centralised marketing authorisation from the European Medicines Agency be required? Or national marketing authorisations via the decentralised or mutual recognition procedure in the EU-25? Moreover, since national SPCs are currently granted and administered by the national patent offices, a new EU agency may need to be established to grant and administer unitary SPCs. Judicial oversight of such an agency will need to be established, and preliminary references to the Court of Justice of the EU (‘CJEU’) will also need to be available, both of which may give rise to tricky issues.

In this regard, EFPIA (the European Federation of Pharmaceutical Industries and Associations), ECPA (the European Crop Protection Association) and IFAH (Representing the European Animal Health Industry) has have published a joint position paper on a unitary SPC, proposing a virtual agency made up from existing staff of national patent offices, who will collectively receive and examine applications for unitary SPCs and take decisions on grant.

Current challenges and emerging issues for the SPC system

Interestingly, the scope of the study goes beyond the interaction with the unitary patent system. The European Commission has included within the terms of reference a general review of the SPC regime. Various emerging issues and challenges have been identified for consideration.

  • The current text of the SPC Regulation is unclear or ambiguous and decisions of the Court of Justice lack coherence. Indeed, the SPC Regulation has been branded by the English Patents Court as ‘unfit for purpose’. As a result, CJEU and the EFTA Court have been confronted with a flood of preliminary references from national courts seeking clarification on issues including: the definition of “product” to be protected; SPC eligibility of certain products; scope of protection of the SPC; duration of the SPC term; types of marketing authorisations that count for the purposes foreseen in the SPC regulation (e.g., provisional marketing authorisations and marketing authorisations granted by the Swiss medicine agency); and eligibility of the paediatric extension for patented medicinal products not eligible to SPC protection. Anecdotal evidence suggests that this has created a significant degree of legal uncertainty and lack of predictability for users of the system.
  • Lack of harmonisation of SPC grant procedures at national level. The current SPC Regulations focus on the substantive requirements for the grant of the certificate, but leave most features of the grant procedure to national laws. This has resulted in differences between national patent offices, such as: some conduct ex-officio examination of the substantive requirements stipulated in the SPC Regulations while others only check formal requirements; some consult regulatory agencies in relation to data related to the marketing authorisation while others do not; furthermore, whilst the SPC Regulations do not permit a procedure for opposition by third parties to the grant of a SPC, some national patent offices allow third party observations to be filed and taken into account.
  • Changes in the industry such as the emergence of biologic products and drug-device combinations mean that the SPC Regulations, which are over 20 years’ old, are in need of updating. For example, does an SPC based on a particular authorised biological product validly extend protection to an biosimilar/authorised variant of that product?
  • Should SPCs be available in other industry sectors such as medical devices, in vitro diagnostics, nano-technologies, which are currently, or might in the future, be subject to comparable or additional lengthy premarket regulatory testing and authorisation procedures?
  • Does the duration of an SPC need to be re-considered? For example, should term extensions be made available for certain sub-categories of medicinal product, as was done under the Paediatric Regulation (Regulation No 1901/2006/EC on medicinal products for paediatric use).

Manufacturing waiver

The Commission has also proposed the introduction of a so-called ‘manufacturing waiver’ during the SPC period, to allow the EU generic and biosimilar medicines industries to manufacture drugs for export to non-EU countries during the SPC period. The Commission believes that this will increase access to high quality medicines in third countries without changing the equilibrium between the originator and the generic and biosimilar medicines industries in the EU, and will create up to 64.000 high-tech jobs in the EU and dozens of new companies. This proposal is likely to be highly controversial.

So what?

The original tender closed in February 2016, with a view to the study starting in April 2016 and reporting within 10 months. The Commission received a very limited number of bids, none of which met the requirements of the tender. This may have been because the original tender covered too many topics for a single study. As a result, the Commission has announced that the tender will be re-launched in May 2016. In the meantime, the Commission is continuing work on how national SPCs may be granted on the basis of Unitary Patents. After this work is completed, they will next tackle Unitary SPCs granted on the basis of Unitary Patents.

Given the importance of the SPC regime to both the innovative and generic/biosimilar sides of the biophamaceutical and agritech industries, the recommendations of the study and any subsequent legislative proposals will be closely scrutinised.