The European Commission (EC) has proposed a Unitary SPC and/or a unified procedure for granting national Supplementary Protection Certificates (SPCs) in the EU (Proposal), which if adopted, will materially change the SPC regime in Europe. The current mechanism for applying for an SPC is decentralised, and national SPCs must be applied for in each EU Member State. 

Patents and Supplementary Protection Certificates (SPCs)

SPCs are an integral part of patent protection, particularly for pharmaceutical products. A patent protects an invention, giving the right to exclude others from exploiting the patented invention without the consent of the patent owner for up to 20 years. An SPC is an additional right that extends patent-like protection for specific medicinal and plant protection products for a maximum period of five years. An SPC is designed to compensate the patentee for the loss of time which may have occurred between the granting of a patent protecting a product and obtaining the marketing authorisation for that product which permitted it to exploit the patent commercially. SPCs are currently granted on a national basis – in Ireland, they are granted under Statutory Instrument No 307/2008 European Communities (Supplementary Protection Certificate) Regulations 2008.

EC Proposal

The Proposal notes that inefficiencies caused by differences between EU countries in the grant, administration, and enforcement of SPCs create a limited and fragmented legal framework which should be addressed. It identifies four key issues: 

1. “Divergent outcomes of the grant procedures across EU countries; 
2. Lack of unitary SPC protection for the future unitary patent;
3. Suboptimal transparency of SPC-related information; and
4. High cost and administrative burden for SPC users.”

The proposal for a regulation to put in place a unitary SPC and/or a unified procedure for granting national SPCs is an attempt to make SPCs more accessible and efficient. The EC argues that this will ultimately benefit the health sector and notes four specific policy objectives in the Proposal:

1. “Increase legal certainty about the procedure for granting SPCs;
2. Provide unitary SPC protection in relation to unitary patents;
3. Make SPC-related information more transparent (e.g. clearer, more easily accessible, more comprehensible and easier to understand);
4. Reduce the cost and burden of obtaining and maintaining SPC protection in the EU.”

The EC suggests three potential options concerning the SPC procedure:

1. “No policy change,” whereby the current legislative system and national approval of SPCs would continue.
2. A “Non-legislative instruments” option whereby guidelines based on national patent office best practices and Court of Justice of the European Union (CJEU) case law would be published to encourage harmonisation of the current SPC system.

   The EC states that this option would address concerns regarding legal certainty about the grant procedure and would make information regarding SPCs more transparent.  However, it does not address the issue of a unitary SPC protection for unitary patents or the cost and burden related to obtaining and maintaining SPC protection.

3. “Legislative changes” and the creation of a centralised SPC system in the EU and targeted amendments to the SPC Regulation. The proposed centralised system could consist of:
   1. a unitary SPC to tie in with the upcoming unitary patent;
   2. a unified procedure for granting national SPCs, without creating a unitary SPC; or
   3. a combination of the two above options.

The EC proposes an impact assessment to determine the details of a centralised SPC system, such as what an examining and granting authority might look like, the language requirements and what form judicial review of decisions may take. 

Impact of the Proposal

The EC suggests that introducing a unified SPC procedure will significantly reduce the current cost burden in applying for SPCs across the Member States. Additionally, the EC believes more legal certainty will result from a more streamlined SPC system for the manufacturers of generics and biosimilars, which amounts to 67% of the volume of all prescribed medicines sold in the EU. 

The objective behind the Proposal is to improve EU incentives for innovation in the pharmaceutical and agrochemical industries, ensuring more and better products for individuals. It also claims that the timely entry of generics and biosimilars is “instrumental for the sustainability of public health budgets in the context of an ageing EU population”. 

Next Steps

While it is likely that any new EU regulation will streamline the SPC application process rather than substantially change the basis for its grant, we will continue to monitor the Proposal as it moves through the EU legislative process. The Consultation Process ended on 5 April 2022 and feedback from 61 stakeholders has been received.

If you require more information regarding patents and SPCs, please contact the William Fry Intellectual Property team. 

Contributed by Sinéad Cullen