EU Pharmaceutical Law: Voucher system may be open to abuse

Currently - in addition to 20 years of patent protection - the market monopoly in the EU is provided by 8 years of data exclusivity protection, followed by a 2-year period of market exclusivity that can be extended for another year (the so-called 8+2+1). This protection is the longest in the world. By comparison, the system used in the U.S., off-patent, provides for a standard 5-year period of data exclusivity. Meanwhile, in the proposed changes to the law, the European Commission plans to extend these exclusivities by up to 2 years, i.e. to a maximum of 13 years, through, among other things, the possibility of acquiring a special Voucher.

According to the National Drug Manufacturers, the monopoly of medicines should not be extended, as this weakens competition in the market and hinders the development of the industry. - The main goal of the planned changes is to be faster and wider access to medicines for EU citizens. Therefore, any doubts that might prevent this must be clarified and focus on tools that realize the goal of improving access. Meanwhile, the Commission is creating legal uncertainty, because it will be difficult to determine when a drug's monopoly ends. And this will inhibit competition, thus limiting the availability of therapies in the EU, as well as hindering the development of an industry producing drugs that compete on price," points out Krzysztof Kopeć, president of National Drug Manufacturers.

The European Commission's planned changes also include the introduction of a transferable Voucher extending market exclusivity by one year for companies that choose to produce the missing antibiotics.

The draft introduces the principle that the Voucher does not have to apply to the antibiotic under which it was granted. It can be sold once to another company, which will be able to use it to extend the monopoly of its any medicinal product. -The Voucher system can be an excellent field for abuse, since the regulations do not provide for the revocation of the benefits obtained in case of unjustified use of the Voucher, Grzegorz Rychwalski warns.

Medicines for Europe (M4E), an organization of European drug manufacturers, stresses in its position on the proposed changes that despite the extension of the monopoly of newly marketed drugs, Europe has not become a world leader in innovation, and the increase in intellectual property protection coincides with the relative deterioration of the European Union's position in relation to China and the US. Therefore - given the impact of a long period of market exclusivity on access to drugs and their prices - its duration should not be extended.

M4E recalls that the European Commission, in its impact assessment of planned changes to pharmaceutical legislation, wrote: "The direct link between the incentives offered in the EU and the Union's competitiveness is difficult to establish because, although the incentives increase the attractiveness of EU markets, they are independent of the geographic origin of the medicines. Approximately 20% of new drugs authorized in the EU originate in the Union, with the remainder mainly from the US, UK, Switzerland and Japan, which are equally eligible for all EU incentives."

M4E cited a study commissioned by the European Commission on the impact of incentive mechanisms on attracting innovation to Europe, which found that tax regulations, education and other factors are likely to be more important in this regard.

Source: National Drug Manufacturers