Leaked EU Pharma Package includes changes to Bolar exemption

In January 2023, POLITICO Europe published a leak of the EU Commission’s proposed reform of EU legislation on pharmaceuticals (the EU Pharma Package). The documents for internal circulation include sweeping changes to the scope of the so-called Bolar exemption to patent infringement. The new provision will cover more activities, and it will extend to third-party suppliers and service providers.

The Bolar provision is an exemption from patent infringement covering use of a patented product or process for studies and trials directed to obtaining a marketing authorisation for a pharmaceutical product. It was introduced in EU law by Article 10(6) of Directive 2001/83 on the Community code relating to medicinal products for human use. Under that provision, “conducting the necessary studies and trials [to obtain a marketing authorisation for a generic or a biosimilar pharmaceutical product] and the consequential practical requirements shall not be regarded as contrary to patent rights or to supplementary protection certificates for medicinal products.”

Medicines for Europe , the European association of generic and biosimilar manufacturers, advocated for change because EU Member States transposed the requirement in different ways, leading to a fragmented regulatory environment, resulting in complexity and uncertainty. The documents obtained by Politico suggest that their wish will be granted.

Article 75 (“Intellectual property rights and exemptions”) of the Draft Proposal for a Directive on the Union code relating to medicinal products for human use provides that the following will not be regarded as infringement of a patent or a supplementary protection certificate for medicinal products (SPC):

(a) studies, trials and other activities conducted to generate data for an application for:

(i)?a marketing authorisation;

(ii)?health technology assessment;

(iii)?pricing and reimbursement.

(b) any activity for the purposes of point (a), including the offer, manufacture, sale, storage, import, use and purchase of patented products or processes, including by third party suppliers and service providers.

On the covered activities, the first change of note is that the exemption in the proposed Directive is no longer limited to authorisations for generic or biosimilar products. It seems innovative drugs will also be exempted under EU law, as is the case in the current implementation of the Bolar provision in Germany and France, for example. Second, activities for the purpose of HTA and pricing and reimbursement procedures are expressly included in the proposed exemption.

Activities by third-party suppliers and service providers are also exempted under the proposed provision. Almost ten years ago, the Oberlandesgericht Düsseldorf asked the EU Court of Justice if the Bolar exemption also extends to commercial suppliers of active ingredients, if they supply patented products to generic manufacturers for the purpose of conducting trials to obtain a marketing authorization (C-661/13, Astellas v Polpharma). The case was settled and the referral was withdrawn before the CJEU could issue a decision. The leaked proposal appears to leaves little room for discussion in this respect.

While the proposed changes to the European Bolar exemption appear in line with the EU’s stated policy objective to promote the launch of generic and biosimilar products upon patent expiry, its broad language may have unintended consequences. For example, exempting any activity by a third party service provider or supplier from the infringement of any patent appears to run counter to Article 30 of the TRIPS agreement. Under that provision, contracting states can provide exceptions to patent rights, ‘provided that such exceptions do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties’. Public health objectives may justify an exception to patent rights directly related to a reference pharmaceutical product (such as the active ingredient or a dosage regime), to enable availability shortly after the expiry of the patent. But neutralizing patent rights in e.g. research tools or processes that are useful for clinical trials or to establish bio-equivalence or biosimilarity seems to unduly restrict the rights of those patent owners.

Even with those concerns, further harmonization of the approach to Bolar provisions in EU Member States is a welcome initiative. The Unified Patent Court will soon have jurisdiction to issue injunctions covering multiple European jurisdictions. Even more so than in the past, a fragmented approach by EU Member States leads to complexity for companies in the sector. Politico reports that the EU Pharma Package is ‘set to land in March’. There may be challenges, but one thing seems certain: change is coming.