ip policy developments in the eu and implications for the
TRANSCRIPT
IP Policy Developments in the EU
and implications for the generic
medicines industry
IGPA, Montreal, September 2009
Lidia Mallo
Government Affairs
EGA represents over 1000 companies in 34 European countries
Generic medicines companies employ over 130,000 people in the EU
Generic medicines companies cover a full spectrum of pharmaceutical needs
Generic medicines companies also undertake incremental innovation
Generic Medicines: Key to
Healthcare Sustainability and
Patient Care
3
Generic medicines in EU27 represent
€25 Billion of savings to governments every year
Generic Medicines- Key to
Healthcare Sustainability
Volume dispensed medicines in EU27
Pharmaceutical expenditure in
EU27
50% generic
medicines
18% generic
medicines
3
EGA – International context
Founding member of the International Generic
Pharmaceutical Alliance (IGPA)
Observer status at WIPO
Admitted into official relations with WHO
Members of IMPACT and IGWG
Observer member at the SACEPO Committee of
the European Patent Office
Content
Conclusions of the European Commission Sector Inquiry
Key findings/Examples of delaying strategies
Recommendations
European Union Patent Court : advantages for the generic industry
Border Measures and the Seizures of Generic Medicines in Transit in the EU
Sector Inquiry
The Pharmaceutical Industry in Europe
Neelie Kroes, European Commissioner for Competition
Timelines
16 JANUARY 08:
Company
investigations
JAN – FEB 08:
Stakeholder
discussions
MAR – SEPT 08:
Questionnaires
to companies
MAR – SEPT 08:
Stakeholders
discussions
24 NOV 08:
New company
investigations
28 NOV 08:
Launch
preliminary
report
31 January 09:
Deadline public
consultation
July 09:
Publication final
report
2010 >
Implementation of
Recommendations
December –
January
EGA (other
stakeholders)
work on
submission
Aim of Inquiry: investigate
company behaviour
Observed delays in the entry of generics
Decline in innovation measured by number of
new medicines coming in the market
Tool under EC Competition Law
To investigate anti-competitive behaviour of
originator companies towards generic companies
To investigate anti-competitive behaviour
between originator companies
Sample of products analysed over 8 years in 17
Member States
Average time gap between loss of exclusivity
and launch of generic
on average: 7 months
for blockbusters: 4 months
Potential savings of €3 Billion more if generic
entry had been immediate
Time Delays & Potential Savings
1010
Delaying Strategies Used by
Originator Companies
TOOLBOX
Patent Strategies
Frivolous Litigation
Lobby Authorities
Lifecycle Strategies
Mis-information
to the Public
Source: Final report Sector
Inquiry, July 09
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Patent thickets: Up to 1300 patents around 1
molecule
Number of patent applications doubled between
2000 and 2007
Quality problem: some patents should have
never been granted
Some patent holders admit some patents not
strong
Originator companies confirm using patent
strategies to extend duration of protection
Key Findings on patents
Patents Patent Strategies
List Follow on Medicines which
Lack Established Added Value
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Molecule Brand name
Expiry date patent
Follow on molecule
Brand name
Remarks
OmeprazoleAnti-acid
Losec Jan 03 Esomeprazole Nexium isomer
Citalopram Anti-depressive
Cipramil Dec 06 Escitalopram Spiralexa isomer
Alendronate 10 mgOsteoporose
Fosamax April 08 Alendronate 70 mg
Fosamax EP 70 mg revoked by several EU Courts
In some cases, originator companies consider litigation not for the merits but as a tool for creating obstacles for generic companies
2000 and 2007: 1300 patent-related disputes -majority started by originator companies
Generic companies won 62% cases
Average duration of litigation: 2.8 years
Total cost for cases analysed over €420 million
Key Findings on litigation
Litigation Frivolous Litigation
EFFECT ON GENERIC COMPANIES:
•Uncertainty because of aggressive litigation
•Delays because of long court procedures
• High costs
•Uncertainty because of different court decisions
on same patent
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Frivolous Litigation
Example of Vexatious Litigation
Teva vs Abbott case In May 2007, Abbott request pre-judgement seizure
of documents, asserting there was imminent infringement of Abbott’s patent rights.
A search was conducted in the Teva offices in Utrecht and Haarlem including a search of the computer server.
However, the District Court found the seizure to be unlawful and should be lifted.
The Court recognised that it was of the utmost importance to generic companies to enter the market as soon as possible after the relevant patent protection expires.
Originator companies “intervene” before
national authorities (in MA and P&R procedures)
raising alleged patent infringement and
safety/quality issues
Very limited success rates of originator
companies in court (2% as regards MA)
On average, granting of MA delayed of 4 months
due to interventions
Key Findings on intervention/patent linkage
Patent Linkage Lobby Authorities
An Example: Portugal
Since July 2007, generic medicines have been
effectively blocked from access to the market
Why?
More than 70 court cases against generic
medicines companies and national authorities
based on market authorisation (MA) granted
before patent expiry, which is in fact possible
by the Bolar Provision(Art 10.6 of Directive 2001/83/EC as amended )
Lobby Authorities
Claiming non-interchangeability of generic
medicines
Causing doubts about quality, safety
and efficacy of generic medicines
Misinformation
campaigns
Mis-information
to the Public
For 40% of investigated products, originators
used follow-on/second generation products that
not always have therapeutic added value
Second products normally launched 5 months to
one year before patent expiry
Sometimes first product is withdrawn and
patients are switched to follow on product
Key Findings
Lifecycle StrategiesLifecycle Strategies
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Lundbeck Switches Citalopram to
Escitalopram to Undermine
Generic Entry and to Remain Own
Sales
0
20,000
40,000
60,000
80,000
100,000
120,000
VOLUME CIPRALEX (SU) VOLUME CIPRAMIL (SU) TOTAL VOLUME (SU)
2002:
Expected generic entry after
loss of exclusivity
2006:
Actual generic entry due to
blocking tactics
Source: IMS Data 2002-200720
Revenue increase of
50% due to switch
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Commission Recommendations
to Get EU System Right
Patent Law
Pharmaceutical
Legislation
Dir 2001/83
Competition
Law
Price Transparency
Directive
1991
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•Reform EPO
system
•Community Patent
•EU Patent Court
•End unjustified
litigation
•No patent linkage
•Respect timelines
•No interventions
•No misinformation
•Immediate P&R for
generic medicines
•No patent Linkage
•No interventions
•Competition Law
Enforcement
•Monitor settlements
EGA Recommendations on the
Sector Inquiry Would:
Foster Innovation
Increase competition
Improve the image of
the sector
Improve patient access
to affordable treatments
Ensure healthcare
sustainability
To Make the Market Work Properly
22
IP Barriers to Innovation and
Competition
“Patents have a key role in
incentives & rewarding
crucial pharmaceutical
research & development”
Misuse of the patent system
however will
a) restrict
access/affordability and
b) discourage real
innovation.
Obtain this report from www.egagenerics.com
EGA key recommendations on
patent quality
Improve quality of applications
– Rigorous assessment of patentability requirements-inventive step
– Introduce “Information disclosure statement” on patentees to ensure that all information/prior art relevant to the patent is disclosed
– Grant examiners stronger incentives to reject « bad »applications
Accelerate opposition procedures
Prohibit filings for substantially identical divisional patents- First results of EPO reform: EPC Rules amended to limit divisional filings strictly to a period of 24 months from the first examination communication.
What is needed is “fewer, better” applications that “pay what it costs.”
Such a system helps those that are “gaming” it, she added. Part of the expectation of the market is that innovative companies have pending patents, so that it is economically helpful to have applications filed. She said she had quotes such as “I don’t really care if you grant or not, I just need the patent pending.”
But, she said, “this isn’t what the IP system is meant to do.”
EPO President Mrs. Brimelow, at
WIPO forum, Sep 2009:
EGA Key Recommendations
On litigation:
a central, European patent court with technically and legally qualified judges
Interlocutory injunctions not to be granted so easily
On patent linkage:
clarification that all regulatory and P&R activity is allowed during patent period.
prevent all intervention in regulatory procedures by originators
On Market Access:
automatic P&R status for generic medicines.
EU Patent Court – main
features
One single EU Patent Court with jurisdiction for European and future Community patents for infringement and revocation actions
EGA supports the EUPC, why?
Eliminating parallel court cases in different MS
Avoidance of conflicting rulings
Significant cost and efficiency improvements (potential savings of between 148 and 289 million €/year (2013)
Stop forum shopping
Netherlands: detention of medicines en route to Brazil/Colombia/Peru from India Dr Reddy’s: Losartan Potassium
Bftalactamicos S.A: Clopidogrel
Cipla: Rivastigmine / Olanzapine
Aurobindo: Abacavir
Warning letters –for ex. Dupont, MSD, Eli Lilly-asking for destruction of the goods detained based on patent infringement in the NL (basis: Court in NL has determined that products in transit also qualify as infringing IPRs as if manufactured in the NL)
“Transit” detention cases –
some controversial examples (i)
UK, Dec 2008: 2 consignments of product en
route to Czech Republic from India detained by
Customs at Heathrow whilst in care of
transport company
Customs (apparently) acted on own initiative
Patentee informed/ Representative of
patentee inspected & took samples
Goods released 7 days after detention
“Transit” detention cases –
some examples (ii)
EC Regulation 1383/2003:
Key Provisions
Customs action against goods “suspected” of infringing intellectual property rights
Customs can act on own volition or further to application by patentee to watch for identified goods
Customs may suspend the release of goods/detain them
Patentee notified of detention
Customs can disclose to patentee names and addresses of consignee, consignor, and holder of goods, as well as origin of goods
Customs may invite patentee to inspect goods, and may provide patentee with samples for analysis
Patentee has (typically) 10 days to commence litigation in country of detention, or goods released
EGA views
EGA welcomes the fight of DG Customs against
counterfeit products
MEDI-FAKE: first EU coordinated action with tremendous
results, with more than 34 million illegal
pharmaceutical products seized.
However, EC-wide issue of counterfeit medicines =
increased risk of bona fide generic pharmaceutical
goods being “accidentally” detained?
EGA concerned that Regulation (EC) 1383/2003
– misapplied by customs authorities or
– misused by IPRs holders to restrict legitimate competition and
prevent the free movement of goods through Europe.
Reactions to incidents (i)
EGA letter to Commissioner DG Customs:Whilst we understand that under EC Regulation No 1383/2003, any EU MS is entitled to detain or seize products that appear to infringe a patent, we would ask for caution to avoid detentions that have no basis and present no public health risk.
EGA meeting with DG Customs: express concern by potential abuse of Regulation
and asks for legislative change/clarification of EC Regulation
Reactions to incidents (ii)
MEPs letter to EU Commissioners for Trade,
Commissioners for Taxation and Customs Union
EFPIA distances itself from Dutch detentions: “it is not
the policy of our members to encourage Member States
to use the powers of detention available to them to
prevent the flow of legitimate generic products from
manufacturer to customer outside the EU…. Where the
product is not counterfeit and it is ascertained that no
IPRs apply at either country of origin or destination, the
customs authorities should allow the product to be
released, irrespective of the IP status of the product in
the EU.”
Conclusion
Legitimate generic products in transit through EU countries should not be the target of actions by customs authorities such as detentions, seizures or destructions.
Regulation (EC) 1383/2003 should focus on the real threat of copyright and trademark abuses perpetrated intentionally by criminal groups.
IMPORTANT to keep counterfeit separate and distinct from patent infringement: “Violations or disputes concerning patents must not be confused with counterfeiting of medical products” (acc. to definition of counterfeit drugs as adopted at the WHO IMPACT Third Meeting in Hamamet 5-7 December)
Thank you for your attention!
For further information consult:
www.egagenerics.com
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.html
http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/counterfeit_piracy/statistics/2009_statistics_for_2008_full_report_en.pdf