Original vs Generic Products — Who is Right

Original vs. Generic Products - Who is Right? Latest developments in European IP Law affecting the Pharmaceutical Industry Martin Schneider „Evolvement of IPRs and its Management“ Mark. Pat. Org Ahmedabad 09/10 February 2008 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008 1

Originals vs. Generics - Who is right? Ø IP assets, in particular patents, are important means for business success of pharmaceutical industry Ø Patents confer exclusivity on a certain invention by granting the right to the patentee to exclude others from utilization thereof for a certain period of time Ø Indispensable tool to ensure return on investment Ø Marketing approval necessary from Health Authorities (Europe): üMRP (Mutual Recognition Procedure) or üCentralized Procedure Ø Sufficient preclinical and clinical data needed to prove safety and efficacy Ø Time to market: may be about 7 -10 years ( additional sheet) Ø Investment: 500 mio CHF and more for 1 single medicament Ø Return on Investment facilitated by Patent Term Extensions / SPCs 2 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Originals vs. Generics - Who is right? § Serious budget restrictions in public health care result in an increasing demand for cheap / affordable medicines § Generics industry specialised to fulfil this need § In some European countries market share on no. of prescription drug more than 50% (DE, UK, DK) § Lack of own research and development on the API cost efficient § Genercis can only be launched after patent expiry § Usually at least some test (bioequivalency) needed for marketing approval § If necessary tests can be performed only after patent expiry originators will practically benefit from a further monopoly beyond normal patent term § Consequence: generics industry might perform necessary tests abroad or delays product launch unless Use Exemptions / Bolar-type provisions provided 3 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Originals vs. Generics - Who is right? Increased pressure to reduce prices of drugs examples (Swiss Regulations): • As from 1. 1. 2006 the franchise (towards social insurance refunding) for original products has been increased to 20 % in case there is an aequivalent generic product • As from 1. 1. 2008: Generics will only be accepted in the „special list“ (that is refunded by social insurance) if they are 40 % cheaper than the corresponding original product 4 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Originals vs. Generics - Who is right? 5 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Originals vs. Generics - Who is right? 6 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Who is smarter? some Basics: Various Categories of Claims Main categories: Ø Drug substance (API, Active Pharmaceutical Ingredient) Ø Combination of APIs Ø Galenic formulation / pharmaceutical composition Ø Medical use / treatment / indication (secondary use) Further categories: Ø Production process / method of making Ø Biotechnological subject matter (gene, DNA, vector, cell line etc. ) Ø Bulk form (e. g. polymorph, crystal form) Ø Research Tools, biological target Ø Screening assay, diagnostic assay Ø Device (e. g. band aid, injector) 7 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Who is smarter? Various categories of claims Example 1 „IGF“ (2001) (Illi / Feldmann ) • Utilization of Growth Factors for the production of Medicaments (WO 00/00180) • Sustained Release Composition comprising Insuline like Growth Factor (IGF) (WO 01/58426 A 1) • Biodegradable Osteosynthesis (US 6, 214, 008 B 1) Example 2 „applicators of eardrops“ (Illi / Feldmann) 8 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Who is smarter? Secondary use claim / pricing policy Example „Finasterid“ (INN) • Propecia ® : men‘s hair loss / enhance hair growth (once-a-day pill) • Proscar ®: Benign Prostatic Hyperplasie • 9 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Who is smarter? Search for barriers / opportunities 10 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – PTEs and SPCs Patent Term Extensions and Supplemental Protection Certificates § PTEs and SPCs introduced to compensate originator companies for time loss resulting from aspproval process § Available in many countries, e. g. US, European countries, Japan, Australia, Israel etc. § May be subject to certain conditions § Compensation for time necessary for obtaining Marketing Authorization (MA) when patentee cannot exploit the invention being the subject of the patent § PTEs / SPCs extremely important because they protect marketed products § Never goes beyond the protection of the patent on which it is based, i. e. confers the same rights as under the basic patent 11 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – PTEs and SPCs Patent Term Extensions and Supplemental Protection Certificates Ø EEC Regulation 1768/92 (pharmacueticals), EEC 1610/96 (agriculture); and natl. SPC in CH Ø Confers at least 15 years of effective protection (i. e. up to 15 years protection after MA) Ø Maximum duration of 5 years after patent expiry Ø To be applied for countrywise within 6 months of the first Marketing Authorization in that country, or within 6 months of grant of patent, whatever is later Ø Duration: Art. 13 of Regulation 1768/92 üIf time from filing of patent application to grant of first MA in the EC or EEA is less than 5 years: no SPC üIf time is more than 10 years, SPC is capped at 5 years üIf time is between 5 and 10 years, duration depends on the date of first MA in the EC 12 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Experimental use exemption Bolar type provisions of non infringement Ø Exemptions for certain activites as exception from otherwise infringment Ø„Experimental Use Exemptions“ usually to promote scientifc research, improvements of inventions etc. ØIn many jurisdictions not allowed if commercial intention Ø„Bolar-type provisions“: special type of use exemptions for activites related to obtain Marketing Authorizations from Health Authorities ØUS case Roche vs. Bolar / Wayman-Hatch Act 1984 (US) Ø Provides Patent Term Extensions for Originators, and Use Exemptions (e. g. for performing clinical tests to obtain marketing approval) for Generics Industries 13 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Experimental use exemption Situation in Europe Germany (Supreme Court Decisions Clinical Trials 1 and 2) ØIn Germany use exemption for activities providing new knowledge / insights ØRegardless whether commercial or non-commercial intention ØIn CH introduction of Bolar-type provisions intended EU (Directive 2004/27/EC) ØIntroduction of broad Bolar-type provisons for activites related to obtaining Marketing Authorization ØNo condition regarding provision of new knowledge Ø Opportunity for Generics businesses for early market entry 14 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Copyright Law – Data Exclusivity Situation in Europe General (see also European Generics Medicines Associations) Data exclusivity guarantees additional market protection for originator pharmaceuticals by preventing health authorities from accepting applications for generic medicines during the period of exclusivity. The effective period of market exclusivity gained by the originator company is the period of data exclusivity (currently 6 or 10 years) plus the time it takes to register and market the generic medicine — a further 1 to 3 years. Data Exclusivity was introduced in 1987 to compensate for insufficient product patent protection in some countries. However, strong product patents are now available in all 27 EU Member States. The rules on data exclusivity have been changed in the new EU pharmaceutical laws adopted in 2004. 15 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Copyright Law – Data Exclusivity Situation in Europe The new legal framework 16 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Patent Law – Filing strategies & costs ØFiling and prosection costs, maintencance fees ØLifetime costs of 1 average pharmaceutical patent family: üAbout 500. 000 CHF üMainly due to increasing maintenance fees and translation costs üOften patent applications are filed via PCT § Advantages? § Cost efficient until final decision on importance § Early comments on patentability before occurence of major costs § London Agreement: Entry into Force on May 1, 2008 (many aspects still unclear; will lead to a considerable reduction of filing costs 17 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Trademark Law – Extension of Monopoly 18 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008

Swiss Patent Law history Parallels to India Patent Law development? 19 © Dr. iur. Martin Schneider Ahmedabad, India - 09/10 February 2008