Patents are creatures of statute. Once an applicant has disclosed an invention, and subject to the application meeting certain statutory standards as to form and content, the European Patent Office grants a 20-year “monopoly”. What is, in fact, granted is not a monopoly but the exclusive right to prevent others from practicing within the boundaries of the granted claims. Contrary to popular belief, a patent does not convey a right of use; it instead conveys a right to stop others from using what has been claimed on the patent without first obtaining a licence from the patent owner.
Life science patents have additional bars on the right to use which other patents generally do not suffer. The most important of these bars is regulatory. A patent owner cannot place a pharmaceutical or agrochemical product on the market until regulatory permission has been received.
Even when regulatory permission has been granted, outlets may be limited and the products may not be generally available to consumers. Furthermore, the regulatory framework may even force products off the market at a later date if contraindications are discovered.
As a result, regulators have introduced special mechanisms to compensate for the sometimes extravagant time it takes to obtain regulatory approval. In Europe, this takes the form of Supplementary Protection Certificates (SPCs). If the launch of a product has been delayed by the pharmaceutical or agrochemicals regulatory process, the patent owner can claim an extension of term of up to five years. In the United States, provisions under the Hatch-Waxman Act afford similar benefits to pharmaceutical patents. In the European Union, more than one “basic patent” can cover a product, so the extension of term is not unique to a single patent per product. No other classes of patents benefit in this way from an extended protection period. For a detailed look at SPCs and the ways in which their use is evolving, please see Are Supplementary Protection Certificates Keeping Pace with Drug Development? on page 14. Another way in which pharmaceutical and agrochemical patents are unique is that minor improvements are patentable.
That of itself is not unique; it is its coupling with the regulatory environment in which a minor improvement extends effective monopoly life that makes it stand out. For example, a pharmaceutically active product may be invented and covered by a product patent. That will take a significant time to come to market, and hence the extension of term will be of value. Inventors may discover new physical forms of a product and they may take out patents on those forms. The regulatory framework will be changed to meet the new form and the combination of the secondary patent and regulatory environment will extend the monopoly period. Similar practice applies to new patentable processes, as the impurities profile changes, and with it the regulatory framework. This progression is unique to life science patents and not found elsewhere. In other fields, once the basic patent has expired, the market is opened to competing products, even if minor improvements are made and patented.
Another way in which life sciences patents are different from those in other fields is in relation to interim injunctions. Interim injunctions in patent cases are generally very difficult to obtain as a final injunction and an award of damages are usually adequate. In pharmaceutical cases, and to a lesser extent in agrochemical cases, the loss of the monopoly accorded to patent rights causes the price of the product to drop precipitously; 90 per cent price drops are normal. Additionally, because patients get used to a particular brand, the withdrawal of that brand is medically problematical. For those two reasons, the courts have been readier to grant interim injunctions to life science patents than to other types of patents.
Life science patents need to be treated with special care. As a breed apart, they need specialised handling.