The sunset clause is a general clause for extinguishing rights which applies to several fields, including the authorisations given by public authorities for the marketing of drugs. According to the sunset clause, any authorisation which is not followed by the actual placing of the drug on the relevant market within three years of authorisation shall cease to be valid. The sunset clause will also apply when a drug previously placed on the market is no longer actually present on the market for three consecutive years.

One of the key issues in the interpretation of this provision is when the sunset clause period starts. There is no single answer to this question because it depends on the type of marketing authorisations potentially affected by the sunset clause.

Centralised procedure and EMEA guidance
Marketing authorisations granted by the European Medicines Agency (EMEA) under the centralised procedure are regulated by EU Regulation 726/2004 of 31st March 2004 laying down EU procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing the European Medicines Agency.

The sunset clause is included (for medicinal products for human use) in Article 14, but neither this article nor any other provision of the regulation provides guidance on when the sunset clause period starts. However, the EMEA has published relevant documents, including post-authorisation guidance for the interpretation of this provision (see www.emea.europa.eu/docs/en_GB/document_library/Medicine_QA/2009/10/WC500004122.pdf and www.ema.europa.eu/docs/en_GB/document_library/Regulatory_and_procedural_guideline/2009
/10/WC500003981.pdf
). According to this guidance, in cases where the marketing authorisation is not followed by actual marketing, the three-year period begins on the date when the medicinal product can be placed on the market by the marketing authorisation holder (ie, at the end of the 10 to 11-year period of market exclusivity of the reference medicinal product and at the end of other protection rules which must be respected).

This interpretative criterion has been included in Section 2.4.2 of Chapter 1 of the Rules Governing Medicinal Products in the European Union, Notice to Applicants, Volume 2A, and the amendments included in the text were aimed at linking the sunset clause to the concept of market exclusivity. Therefore, it seems that patent rights would fall within the above-mentioned other protection rules.

The marketing authorisation holder must notify the EMEA of the existence of rights that would prevent the marketing of the drug within the three-year term foreseen by Article 14 of the regulation.

Mutual recognition and decentralised procedures
Both procedures are foreseen by EU Directive 2001/83/EC on the EU code relating to medicinal products for human use. Article 24 of the directive includes the sunset clause with the same wording as Regulation 726/2004. Again, the directive includes no provision on how the sunset clause must be interpreted – and specifically, on when the sunset clause period starts. Furthermore, to date the European Court of Justice has not ruled on the interpretation of this provision.

Directive 2001/83/EC was implemented in Spain by means of Act 29/2006. Article 21.4 expressly includes the sunset clause and the Spanish legislature has used practically the same wording as Regulation 726/2004 and Directive 2001/83/EC.

The legislature has issued further regulations affecting the sunset clause set out in Article 21.4, including the following:

  • Article 28.3 of Royal Decree 1345/2007 establishes that the sunset clause period starts the day after notification by the Spanish Medicines Agency of the resolution granting marketing authorisation for the drug.
  • Article 69.1 of Royal Decree 1345/2007 establishes that the suspension of marketing authorisation by the Spanish Medicines Agency does not interrupt the three-year term set out by Article 28.3.

The law contemplates no exceptions to these provisions, and the Spanish Medicines Agency has issued no documentation considering the existence of other protection rules which must be respected as a circumstance that could affect the start date of the sunset clause.

That said, the Spanish courts have issued several decisions that could lead to the conclusion that the existence of patent rights does not affect when the sunset clause period starts. Contrary to the opinion given by the EMEA in the context of marketing authorisations granted under the decentralised process, the Spanish courts have not linked the sunset clause to the concept of market exclusivity.

The background of all these cases has been similar:

  • A generic company obtains a marketing authorisation more than three years before the expiry of the patent protecting the active ingredient or drug.
  • The patent owner tries to prevent the launch of the generic drug.
  • One of the indications alleged by the patent owner for proving the imminent infringement of the patent is the cancellation of the marketing authorisation due to the sunset clause if the defendant really had the intention of respecting the exclusivity life of the patent (for further details please see "Pre-launch activities by generic companies: patent law and unfair competition").

In all these cases, the courts have confirmed the start date as given in Article 28.3 of Royal Decree 1345/2007, and therefore have ruled out the possibility that this provision may be affected by the fact that the marketing authorisation holder is prevented from marketing the drug because of the existence of a third-party patent right.

This reasoning can be found in the following decisions:

  • Barcelona Commercial Court No 5, 29th December 2009.
  • Barcelona Commercial Court No 5, 16th November 2010.
  • Barcelona Court of Appeals (Section 15), 20th January 2011.
  • Barcelona Commercial Court No 5,1st August 2012.
  • Barcelona Court of Appeals (Section 15), 22nd January 2013.

This last decision is especially relevant because it specifically refers to the interpretation given by the EMEA to Article 14 of Regulation 726/2004. However, the court gave no weight to this interpretation in light of the national provisions referred to above, and the fact that to date, such interpretation has not been assumed by the Spanish Medicines Agency or the Spanish contentious administrative courts.

The 16th November 2010 decision also rules out the possibility of avoiding the effects of the sunset clause by requesting suspension of the marketing authorisations until the patent protecting the active ingredient is close to expiry. According to this decision, suspension of the marketing authorisation is not foreseen for such a situation and, in any event, according to Article 69.1 of Royal Decree 1345/2007, suspension of the marketing authorisation does not interrupt the three-year period of the sunset clause.

This article first appeared in IAM magazine. For further information please visit www.iam-magazine.com. in the author field if locked - at bottom of article if unlocked.