The proposal of the so-called SPC Manufacturing Waiver presented by the European Commission will permit that while a Supplementary Protection Certificate (SPC) is in force, generics or biosimilars may be manufactured in the EU in order to be exported to countries where they can be marketed without breaching valid patents. According to the Commission, the purpose is to help European pharmaceutical companies to take advantage of the fast growing global markets, encourage employment and investments in the EU.

The proposal comes with safeguards aiming to provide transparency and avoiding that products that may infringe intellectual property rights are introduced in the European markets. In this regard, manufacturers willing to adhere to the SPC Manufacturing Waiver must notify their activity to a national authority and products manufactured under this system shall incorporate a label indicating that they are intended to be exported.

The SPC Manufacturing Waiver is expected to be applied only with regard to SPCs granted after the new regulation enters into force.

…but maybe insufficient

In the field of medicinal products, any debate about intellectual property raises emotional reactions that difficult a detailed analysis of the situation. This case is not an exception and our opinion is that the progress made with the SPC Manufacturing Waiver will be very limited without any real benefit for innovator companies.

The proposal is interesting, but insufficient. It is true that there is a risk of loss of investments in the EU because generics or biosimilars destined to be exported cannot be manufactured in the EU but also (and especially) because in the EU generics or biosimilar companies cannot manufacture and stock products in Europe in order to enter the EU market right after expiry of the corresponding SPC.

Because of this, European companies entrust manufacturers of third countries with the development and manufacture of generics and biosimilars that will still arrive to the EU the day after the SPC has expired. Innovators gain nothing since the generic or biosimilar reaches the market on day 1 after expiry of the SPC anyway. The real beneficiaries are the manufacturers of thirds countries, who have developed high level industrial and commercial abilities, operating under EU-GMPs, and who are benefiting from the transfer of technology that European manufacturers have carried out.

Consequently, we think that it makes little sense to legislate thinking only about the markets of countries outside of the EU. European manufacturers should be able to develop and manufacture, in the EU, the generics and biosimilars that could be marketed in the EU when intellectual property rights cease to be in force. Making this possible would benefit the European industrial network without harming the innovator companies.

La entrada The European Commission presents its proposal for SPC Manufacturing Waiver proposal limited to exports aparece primero en Faus & Moliner Abogados.

This case begun when a doctor treating a patient with Parkinson came to the conclusion that, in this specific case, the generic medicinal product which the patient was getting from the pharmacy did not have the same effect as the branded product which the doctor had prescribed. The substitution had been carried out by the pharmacist in a correct legal manner, because the branded product had a price higher than the generic. However, given the circumstances, the doctor encouraged the patient to buy the branded product, which would not be reimbursed, and to file a claim for reimbursement later on.

The Law and individual rights

The Court that analysed this case ruled in favour of the patient, basing the decision on the need to protect his individual rights. According to the Court, what is crucial to resolve this case is not that the pharmacy was obliged to dispatch the generic product due to its lower price; but the fact that the patient had the right to protect his health and to obtain the branded product prescribed by the Neurology Service that was treating him if, in his case, the result obtained with the branded product were better than those obtained with the generic.

According to the Court the protection of the individual right of the patient is contemplated by Article 85 of Law 29/2006 on prescription, dispensation and substitution; because according to this article the principle that must prevail is that the prescription must be made in the most appropriate manner for the benefit of patients.

The Court also recalls that the same law provides that the sustainability of the system must be protected and it envisages that, because of this, the prescription and dispensation of the branded product is possible only if its price is not higher than the one of the generic one. However, according to the judgement, this rule has to be disregarded in the case of non substitutable products, and in order to determine whether a medicinal product is substitutable or not, it is possible and even necessary to take into account the individual situation of each patient. If the condition of a patient treated with a branded product aggravates when he starts being treated with the generic version, the Court says, these products must be considered as non-substitutable at least in the case of the specific patient.

Selection and Substitution of biological products

The ideas expressed in this judgment contribute to the debate on the situation of patients treated with biological medicinal products. For these products, where prescribing by brand name is compulsory, and where identification of the brand and of the batch of the product administered to the patient is required for pharmacovigilance purposes, substitution without the consent of the patient and the prescribing doctor is not only illegal but it also infringes the individual rights of patients recognized in the Constitution. This applies to any type of selecting measure that implies generalizing substitution or that makes the prescribers treat the new patients with a biologic medicinal product to the detriment of another. The doctor’s criterion, and the patient’s right to be informed and to be able to choose from the available alternatives must prevail in all cases, and especially in this one.

La entrada Substitution of medicinal products and individual rights of patients aparece primero en Faus & Moliner Abogados.

In this recent decision of the Commission, not yet published, it is stated that Servier breached European competition law at least in two instances. On the one hand, Servier acquired the control of a company that developed a technology which would allow to manufacture generic versions of perindopril without infringing several secondary patents of Servier. When reading the press release, it seems that the Commission understands that the breach of Servier is not the result of just acquiring this company, but it derives from the fact that Servier itself stated that its intention when buying this company was to defend its business of perindopril, and because, in fact, Servier never used the technology of this company.

On the other hand, the Commission understands it has evidence that Servier and the generic companies reached agreements under which Servier paid significant amounts to delay the entry into the market of perindopril generic versions. In this area, the issue is undoubtedly more complex, because what Servier did, apparently, was to compensate the generic manufactures in exchange for their withdrawing of cases that had been triggered to invalidate Servier’s secondary patents. Additionally, the Commission also states in its press release that Servier would have paid some companies to limit the sales to certain countries.

A matter of balance

We are therefore in front of a new case where what is discussed is the balance between the legitimate rights of patent holders and the exercise of those rights taking into account public interests. This is not a new question. The Civil Code, which goes back to the 19th century, already states in article 7 that the Law does not protect the abuse of any right or the antisocial exercise of any right, and that all acts or omissions that go beyond what may be considered reasonable, causing damage to a third party, will result in the obligation to pay damages.
The issue, however, is a very complex one. It is not irrelevant that the Commission, in its press release states that “it is legitimate – and desirable – to apply for patents, including so-called ‘process’ patents, to enforce them, to transfer technologies and to settle litigation”. It is evident that public interest must protect innovation and facilitate the settlement of court cases. Moreover, the Commission understands that the defense of competition as a tool which is necessary to protect the interests of consumers and guarantee economic growth requires to be very strict if the authorities detect that the exercise of this right is being carried out in an abusive manner.
The only conclusion that we think may be derived from all of this is that, in these matters, the facts must be analyzed very carefully.

La entrada The European Commission fines Servier and five generic companies for breach of antitrust rules aparece primero en Faus & Moliner Abogados.

The generic clopidogrel based medicinal products that were approved starting from July 2008, when the basic patents of this product expired, showed two differences with respect to Plavix® that was the reference medicinal product: the generics contained a clopidrogel salt different from the one used for Plavix® and could not include, among their approved indications, the treatment of acute coronary syndrome in combination with acetylsalicylic acid.

These differences were due to the fact that both the clopidogrel salt used for Plavix® as well as the indication in question were protected by specific patents until February 2013 and February 2017 respectively.

It is known that the European regulation provides that the different salts of an active ingredient shall be considered the same active ingredient, unless they have significantly different properties with regard to safety and/or efficacy and that the authorization of generics with exclusion of indications of the original medicinal product that are still protected by patents is also permitted.

In this situation, the French Competition Authority ruled about a matter regarding the information that the company that holds the  marketing authorization of the reference medicinal product can provide, where appropriate, to healthcare professionals, before the launch of the generic medicinal product.

Information versus abuse

In this case, the French Authority considered that Sanofi-Aventis had designed and implemented a communication strategy specifically designed to generate confusion regarding the properties of the generics and therefore it achieved that the penetration of the generics in the market was much lower than the normal level of penetration.

Without entering into an analysis of the decision, which is not relevant for our remarks, we must highlight two aspects. In the first place, we would like to draw the attention to the type of procedure chosen by the generic company that filed the complaint. To file a complaint against an information or promotional campaign on the basis of the competition defense rules is possible, and may be more attractive than filing a complaint before the ordinary courts or before self-regulatory systems. The decision of the French Authority is a precedent to bear in mind.

In the second place, the rules that prohibit the abuse of a dominant position or unfair conduct must always be taken into account when considering the strategies to adopt in the event of changes in the market structure. To defend the position that has been achieved thanks to innovation and to the own efforts is legitimate, but the line between abuse and disloyalty can be very fine; and the reading of this Decision proves that some administrations are willing to enter into this discussion.

La entrada The strategies in view of the approval of generics and the rules of competition defense aparece primero en Faus & Moliner Abogados.

At the end of last year, in a Judgment of 9 December, the National High Court (Audiencia Nacional) modified its criteria on whether presentations (sku’s) of products which were not effectively marketed could be taken into consideration in order to create a group and calculate the reference price.

Until then, case law had accepted the position of the administration: in order to create a group and to establish the reference price it was enough if a favorable resolution on the inclusion of the medicinal product in the pharmaceutical benefits of the National Health System (NHS) had been adopted, there was no need for such product to be effectively marketed.

In the judgment of 9 of December of 2010, the National High Court revised its criteria and ruled that Law 29/2006 should be interpreted in the sense that the reference price system requires that the presentations included in the groups be effectively launched and marketed, because only if this condition was met could the rules regarding dispensation and substitution work properly.

In this situation, and having the administration lodged appeals against these judgments before the Supreme Court, Royal Decree-Law 9/2011 was approved. The Preamble of this regulation points out that the new wording of article 93 of the Law clarifies how groups of the reference price system should be defined; and it adds (we quote literally) that this clarification was made “in order to avoid interpretative discrepancies caused by the initial lack of definition of the concept, which in the past has led to the application of different criteria by the case law”.

Anyone familiar with the background could think, upon reading these words in the preamble, that the matter would be finally resolved. Well, what has happened is that the administration is coming back: under the new article 93, groups may be created as soon as there is a presentation of a generic or biosimilar medicinal product included in the pharmaceutical benefits of the NHS, and new products shall be integrated in the corresponding group from the date on which they are included in such pharmaceutical benefits, which will always happen before their launch onto the market. No effective marketing is thus required, and the reference price shall be the lowest one regardless of whether the presentation in question is available on the market or not.

Therefore, after some steps forward, it seems we have moved backwards. This becomes evident when reading the two judgments of the High Court of 21 of September of 2011, issued after the entry into force of Royal Decree-Law 9/2011. The court understands that it will have to be admitted that the creation of groups of the reference price system will not depend on the marketing or effective placing on the market of the generic medicinal product.

And what about the homogeneous groupings?

The criterion which the Court announces that it will maintain with regard to the groups of the reference price system is not necessarily applicable to the homogeneous groupings and to the system of dispensation of the product with the lowest price.

This is so because after the entry into force of Royal Decree-Law 9/2011, the reference price system shall only have a secondary relevance in relation with the prescription system and with the new rules applicable to the dispensing by pharmacists.

In this respect, we must first remember that the products included in the homogeneous groupings are not necessarily the same as those integrated in the reference price groups. In order to be included in one of the reference price groups, it is sufficient to have the same active pharmaceutical ingredient and the same route of administration. For homogeneous groupings, in addition to the same active ingredient/s, it is required the same dosage form, contents, pharmaceutical form or group of pharmaceutical form, and route of administration.

It is also required that the presentations in question are reimbursed. Furthermore, something especially important is also required that is not foreseen regarding the reference price groups: the products included in each grouping must be interchangeable in the dispensation. If there is no possibility of interchange when the patient arrives at the pharmacy with the prescription, the product in question must not be included in any homogeneous grouping.

This criterion, that the General Directorate of Pharmacy and Medical Devices has admitted with respect to original medicinal products that are not subject to generic competition because it makes no sense to create groupings of one single product, must be applied likewise in these cases. Products that are not actually marketed and with regard to which there is no real possibility of interchange should not be included in the groupings. The same criterion shall have to be used when updating the lists of homogeneous groupings.

If this criteria is not followed, we may see that, pursuant to article 86 of the Law, when a patient goes to the pharmacy and he cannot be dispensed the product with the lowest price from the grouping because it is not marketed or because there is a temporary shortage, the pharmacist shall have to dispense the product with the next lowest price. It seems simply impossible to manage this situation, from the point of view of the payments made to pharmacists. Who can decide (and how and when) that there is a shortage of supply that justifies to dispense a product with a price higher than the lowest price of the grouping? What guarantee will the pharmacist have that he will be paid for the prescriptions of these products with a higher price?

The logic of the system requires that the real possibility of the dispensing of the product is fully assessed before a product enters a grouping. For this reason, even after the entry into force of Royal Decree-Law, the criterion of the previous case law is still valid, at least with regard to the homogeneous groupings.

La entrada Homogeneous groupings should only include marketed SKU’s for which there is a real possibility of substitution aparece primero en Faus & Moliner Abogados.